With the hot real estate market in the Tampa Bay area projected to continue into this year, it is important for Buyers to understand what a Deed is, and how to know whether they are receiving a “good Deed”. This is particularly important in a “sale by owner”, where a Seller may want to avoid involving brokers or other professionals. A Deed is the document by which a Seller conveys and transfers ownership of real property to a Buyer. Knowing the type of Deed involved, and what it either does or does not warrant, will allow Buyers greater certainty in making their investment. The Deeds most often encountered in residential real estate transactions are the Warranty Deed and Quitclaim Deed. This column limits discussion to only those two Deed forms.

Any time a Buyer contacts me and indicates the Seller only wants to give a Quitclaim Deed, my first question is, “Why?”. Receiving a Quitclaim Deed is like someone reaching into a grab bag blindfolded, pulling out a handful of “whatever”, turning to you while also blindfolded, and saying, “not exactly sure what I have, but here, it’s yours”. Even though, by accepting the handful, it may now be yours, you’re not exactly sure what you’re about to receive. Similarly, when a Seller gives a Quitclaim Deed, they are basically saying, “Here…, whatever I have is now yours”. If the Seller who delivers a Quitclaim Deed has less than full legal title, the Buyer accepting the Quitclaim Deed just received whatever the Seller had to sell; but something less than full legal title. Since a Quitclaim Deed contains no warranties as to what a Buyer is receiving, a Buyer accepting a Quitclaim Deed has no recourse against the Seller if full legal title is not actually conveyed. Because of the lack of warranties, Quitclaim Deeds are most often used in family gift transfers, or transfers to a closely held entity or trust.

When acquiring title to real property, the “good Deed” is the Warranty Deed. When a Seller gives a Warranty Deed, they make the following warranties with respect to their title and ownership of the transferred real property: (i) I not only own the property, I own “all” of the property, and not just a percentage or some dissected rights in it, (ii) I have every right and authority under law to convey my good, full legal title to you, (iii) there are absolutely no defects or valid claims against my title and ownership rights in the property, and I’ll guaranty that all the way back to the beginning of time, and (iv) there are no undisclosed liens, restrictions or encumbrances against the property. It is important to note the warranty in item (iv). It does not say there are absolutely “no” liens, restrictions or encumbrances; only undisclosed ones. That is why, even in a transaction involving delivery of a Warranty Deed, it is highly recommended the Buyer receive a policy of owner’s title insurance as part of the transaction. In the course of issuing an owner’s title insurance policy, the title company conducts an extensive search and issues a preliminary “title commitment” which reflects all potential title defects and those matters to which title will be subject, such as subdivision or condominium restrictions, or utility easements.

The best place to make certain you will receive a “good Deed” is the Contract which spells out the terms of the acquisition. If you have questions concerning the use of Quitclaim Deeds or Warranty Deeds, or need other advice regarding real estate contracts or conveyances, at Bob Bible Law, we have the knowledge and over 35 years of experience to help you navigate Deeds and other aspects of your real estate transactions.

For more information, contact Robert W. Bible, Jr., Attorney At Law at 727/538-7739 (office), 727/710-5166 (cell) or by email at: b.bible@BobBibleLaw.com; www.BobBibleLaw.com