Deeds can be complex. You should not try to draft and record one yourself. If you do not record a Deed correctly, the stakes are high, and you could forever cloud title on a Property. There are several different types of deeds. They are:
General Warranty Deed: If a Grantor uses this type of Deed, he promises that his rights to the land are guaranteed and there are no claims against the Property. Mortgage Lenders typically insist on this type of Deed. This type of Deed is most commonly used to transfer title on residential properties.
Quit Claim Deed: If a Grantor uses this type of Deed, the Grantor makes no promises that they have any rights to the land.
Special Warranty Deed: If a Grantor uses this type of Deed, the Grantor promises that there were no claims against the Property while the Grantor owned the property. The Grantor is not guaranteeing claims to the Property when previous owners owned the Property. This type of Deed is used to transfer title on commercial properties or in foreclosure situations.
Bargain and Sale Deed: If a Grantor uses this type of Deed, the Grantor holds an interest in Property being conveyed, but conveys title without the usual Covenants listed in a General Warranty Deed.
In addition, there are several ways Grantees can take title to Property. These types of ownership may not seem like a big deal, but the type of ownership will affect what happens to the Property when one or all owners pass. They are:
Sole Ownership: For Properties in the name of one owner only. When the sole owner passes, the Property will pass according to probate laws.
Joint tenancy with the right of survivorship: For Properties owned by multiple owners. If one owner passes, the other owner or owners get full ownership of the Property without passing through probate. Note: if Property is held in Joint Tenancy with Right of Survivorship, creditors of one owner can try to lay claim to the Property.
Tenancy in Common: For Properties owned by multiple owners. One or more owners own the Property together. After each owner passes, each owner’s individual share of the Property goes to their individual beneficiaries.
Tenancy by the Entirety: For married couples only. If one owner dies, the surviving owner gets full ownership of the Property without passing through probate. Creditors of one owner CANNOT lay claim to the Property. Unlike the other types of ownership, in a Tenancy by the Entirety, one spouse cannot sell their share of the Property without consent of the other spouse.
In a Living Trust: This type of ownership gives an owner total control over what happens to the Property after they pass.