Warranty Deed vs Quitclaim Deed

The primary difference between a warranty and quitclaim deed is that a warranty deed guarantees that the seller owns the property in a real estate transaction. But the quitclaim deed does not make any such guarantees even though it is considered legally sufficient to convey transfer of ownership. Warranty deeds are used in complex transactions, including completely unrelated parties. In contrast, a quitclaim deed is used when the ownership is transferred to related people like family members or a trustee.

In a real estate transaction, a warranty deed is a legal document between the grantor (seller) and grantee (buyer) that seeks to protect the buyer against frauds and ownership disputes that often follow a complicated real estate transaction.

This document is often the highest form of legal protection the buyer can get. It is normally a must-have for applications to loans and other financing options when buying a property. The warranty deed assures the title and ownership rights of the seller. It verifies that the seller has all legal rights mandated by law to sell the property and transfer title. The warranty deed warrants that the asset is free of any mortgage, liens, or other complications that can burden the buyer after the purchase. It also helps confirm defense against any third-party ownership claims to the property. If any title problems arise afterward, the buyer could technically initiate litigation against the seller for breach of guarantee.

The warranty deed is a must-have for real estate transactions between two entities with no history of conducting business. This is because the warranty deed is necessary for legal safety against any fraud or litigation claims in the future.

The primary feature of a quitclaim deed is that it warrants only the interest the grantor has at the time of the deed’s execution and not the title and ownership rights of the property under question. As a result, it makes quitclaim deeds susceptible to frauds in real estate transactions, and buyers signing a quitclaim deed must be aware of the risk they are taking up during the execution of the deed.

Without the warranties afforded to the purchaser by other deeds, it hardly offers the grantee any solution against the seller if a dispute ever arises in the future. This increases the risk the purchaser undertakes in signing such contracts.

Due to the lack of safety, quitclaim deeds are unsuitable when purchasing a property from an unknown person in a traditional sale. Therefore, they are usually present in title transfers due to wills, divorce settlements, lottery wins, etc. However, it does often see interest between two people who share a high degree of trust, especially in a transaction between family members. It is also used in cases where the absence of any liens or mortgages on the property or dispute of ownership with a third party is known for fact. 

The acceptance of a quitclaim deed is the jurisdiction of local authorities and differs from state to state and any dispute.

Both Warranty deed and quitclaim deed are relevant when it comes to transferring ownership of property. They are both legally binding documents that are filed with the local courts and regional authorities. Since they are both associated with the conveyance of real property, there are some data that should be included in both. These include items like property boundaries, the language of conveyance, and the signatures of both parties. Both the deeds should be written statements that must be made part of the public record.

This has been a guide to Warranty Deed vs Quitclaim Deed. Here we discuss the top 5 differences between Warranty deed and Quitclaim deed along with infographics. You may also have a look at the following useful articles –

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