Is a Warranty Deed Good Enough

Discussion in 'Homesteading Questions' started by Tango, Apr 22, 2005.

  1. Tango

    Tango Well-Known Member

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    Reading over my land contract, I see a statement saying: "UPON payoff performance by the buyer(s), Seller(s) shall execute and deliver to buyer(s) a Warranty Deed, conveying to buyer(s) marketable title & deed to said premises, free from all liens."
    Is this good? Should I pay an attorney to perform a title search just in case? I'm used to buying title insurance but that is not the custom in this rural county where my property is located. Actually here the seller usually pays for the title insurance at closing for buyer. Thanks for your help.
     
  2. agmantoo

    agmantoo agmantoo Supporter

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    Research the deed, buy title insurance; always. Do an offer to purchase and contract form up front agreement anytime you do a land purchase. Never go on just a handshake or a verbal. People change their mind or forget what they commit. It will come back to bite you in the rear otherwise!
     

  3. Tango

    Tango Well-Known Member

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    Thanks agmantoo. Just to be clear there is no handshake or verbal. This is through a real estate broker and closing through an attorney.
     
  4. Cyngbaeld

    Cyngbaeld In Remembrance Supporter

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    A warranty deed is the most common one used to transfer property. Title insurance is in addition to the warranty deed. Most of the real estate closings I've had were done in the title company office with the title company handling all the paper work.

    What you DON'T want is a Quit Claim deed. Some people that use them are less than honest in the way they handle them.
     
  5. Ann-NWIowa

    Ann-NWIowa Well-Known Member Supporter

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    A title search is to show who holds title as well as what liens are against a property. A warranty deed from someone who does not hold title would be worthless. Also, you do not want to buy a property with liens against it. When talking about the amount of money involved in a real estate transaction I would always have attorney represent my interests. Realtors are not attorneys and their bottom line is the sale/commission. Most realtors wouldn't deliberately steer you wrong, however I would protect my own interests by using an attorney and title insurance. A warranty deed is the best way to take title.
     
  6. Tango

    Tango Well-Known Member

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    Thank you Cyngbaeld, that was the distinction I was trying to recall.
     
  7. willow_girl

    willow_girl Very Dairy

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    Buy title insurance.
     
  8. Cyngbaeld

    Cyngbaeld In Remembrance Supporter

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    You are welcome, Marcia, hope all goes well with your move.
    Kim
     
  9. RMShepp

    RMShepp Active Member

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    There is more than one kind of warranty deed, at least where I live. There is a special warranty deed, and a general warranty deed. As I understand the difference a special warranty deed conveys to you whatever title the seller has to convey. A general warranty the seller "warrants" the title against all others. I think an hours worth of a lawyers time would be well worth the cost.
     
  10. hisenthlay

    hisenthlay a.k.a. hyzenthlay

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    I just finished up a real estate law course, and here is what I know:

    ALWAYS do a title search!

    Title insurance is a VERY good idea.

    General Warranty Deed: The seller guarantees that there is no defect in title other than something that has been explicitly stated in the contract (easements, liens, encroachments, etc.). The seller will be held legally responsible for any defect in the title. This is a good deed to get.

    Special Warranty Deed: The seller guarantees that there is no defect in the title due to anything done by the seller or anyone the seller associated with during the time the seller owned the land. This is the most common sort of deed used in commercial real estate transactions (office buildings, retail, etc.). Otherwise, it depends on where you live to determine whether this sort of deed is the norm. It is not necessarily a great deed to have--what if the seller only had the property for a year, but there was a problem with the title when s/he got it. Then, that problem would fall on your shoulders and you could lose the land, and possibly have no recourse against the seller. It's not necessarily a bad deed, either. This is where an attorney, a title search, and title insurance come in.

    Quitclaim Deed: The seller makes no warranty whatsoever, and has no legal responsibility if there is a defect in the title. Whatever claim they have to the land, they transfer to you. This is often used if the property is being sold by a trustee, because trustees often will not take any responsibility for any sort of title defect. In a situation like this, a quitclaim deed is not necessarily a sign that there is anything wrong with the title.

    Bottom line: get professional advice. There are no one line answers, and this is too important/expensive an investment to take shortcuts.

    Good Luck!
     
  11. Tango

    Tango Well-Known Member

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    Thanks for all the responses. I'm going to pay for a title search. I think these things vary across the country. As I said in my original post, here in Florida, title insurance is commonly purchased by the seller for the buyer. Title companies, not attorneys. commonly handle the closings of real estate. Where I'm moving, there is no title company and my request for a title search was directed to an attorney, the same one handling the closing.