# What Is a Warranty Deed? Types, Benefits, and Uses Explained

![Warranty Deed: A real estate document confirming a property has a clear title.](https://www.investopedia.com/thmb/A4IqQu5CjRp1KlurE_YwPCnVSUo=/1500x0/filters:no_upscale():max_bytes(150000):strip_icc()/warranty-deed.asp-final-2a0e8a39d1b84928be46a974fb78d5c8.png)

*— Investopedia / Tara Anand*

## What Is a Warranty Deed?

A warranty deed is a crucial real estate document that ensures a property is available for sale with a clear title, free from liens or mortgages. It provides the buyer with legal assurance against future claims to the title. This article explores the workings of warranty deeds, the responsibilities of the grantor and grantee, and delves into the differences between general and special warranty deeds.

### Key Takeaways

*   A warranty deed is a legal document that confirms a property has a clear title and protects the buyer from future claims and liens.
*   There are two main types of warranty deeds: general warranty deeds, which offer comprehensive protection, and special warranty deeds, which cover only the period of the seller’s ownership.
*   Title insurance, combined with a warranty deed and a title search, offers the highest protection level against potential property title defects.
*   Most lenders require a warranty deed for financed properties to ensure the property title is free from claims or liens.
*   A warranty deed is often facilitated by a real estate agent or lawyer to provide the buyer with peace of mind regarding property ownership.

## Understanding the Function of Warranty Deeds

A deed is a legal document that transfers [real estate](https://www.investopedia.com/terms/r/realestate.asp) from a seller to a buyer. In a real estate transaction, a title company checks the property's current and past ownership for title defects or issues.

A warranty deed makes the seller responsible for any breaches found after a title search, regardless of their knowledge or when the breach occurred. It ensures that the buyer will not be responsible for any past title defects or [encumbrances](https://www.investopedia.com/terms/e/encumbrance.asp).

The warranty deed is delivered to the grantee during the [closing of the sale](https://www.investopedia.com/terms/c/closing.asp#:~:text=What%20Is%20Closing%3F,the%20seller%20to%20the%20buyer.). It includes a legal description of the property, is signed and witnessed according to state law, and shows the sale price.

## Different Variants of Warranty Deeds

### General Warranty Deed

• The grantor warrants that they are the rightful owner of the property and have the legal right to transfer the title of the property in a sale.

• The grantor warrants that the property is free and clear of all liens and that there are no outstanding claims on the property from a creditor who may claim it as collateral.

• A guarantee that the title can withstand any third-party claims to ownership of the property.

### Special Warranty Deed

• Conveys that the grantor holds the title and there has been no [encumbrance](https://www.investopedia.com/terms/e/encumbrance.asp) of the property during the grantor’s ownership period of the property.

• The grantor does not guarantee against any defects in [clear title](https://www.investopedia.com/terms/c/clear-title.asp) that existed before they took possession of the property.  
  

## Steps to Obtain a Warranty Deed

1.  Consult a real estate agent or lawyer who specializes in property transactions.
2.  Verify that the property title is free of liens or claims before proceeding.
3.  Work with your real estate advisor to draft and finalize the warranty deed.
4.  Ensure the deed contains a legal description of the property and is properly signed and witnessed.
5.  Present the completed deed to the buyer at the closing of the sale.  
    

## Exploring Other Common Real Estate Deeds

*   The [quitclaim deed](https://www.investopedia.com/terms/q/quitclaimdeed.asp) transfers property from one individual to another without a sale, usually between family members or during divorce proceedings. Once the deed is signed, any claim to the property is relinquished and a quitclaim deed prevents the owner from any future interests in the property.  
    
*   A [deed in lieu](https://www.investopedia.com/terms/d/deed_in_lieu_of_foreclosure.asp#:~:text=A%20deed%20in%20lieu%20of%20foreclosure%20is%20a%20document%20that,relief%20from%20the%20mortgage%20debt.) transfers the property to the lender through a deed in lieu of foreclosure when a borrower defaults on their mortgage and avoids registering a foreclosure on the borrower's credit history.   
    
*   A special purpose deed is used during court proceedings and allows those acting on behalf of the property to make property transfers without incurring personal liability.  
    

## What Is the Difference Between Title Insurance and a Warranty Deed?

A title company completes a title search and examines public records for any issues or errors. The guarantees and disclosures in a general warranty deed allow the new owner to hold the former owner responsible if there is a title defect or if a claim is made against the title. Title insurance covers a wider range of potential claims than the general warranty deed does, including conflicting estate [wills](https://www.investopedia.com/terms/w/will.asp) or [tax liens](https://www.investopedia.com/terms/t/taxliencertificate.asp).

## What Are Examples of Claims That Are Protected by Warranty Deeds?

A buyer, or new owner, will be protected from previous owner's fines issued because of code violations, or if a previous owner failed to pay [HOA](https://www.investopedia.com/terms/h/hoa.asp) fees.

  

## What Are the Risks of a Special Warranty Deed?

Unlike a general warranty deed, the seller is not liable for any title issues that could have occurred before they took ownership. This creates a risk for a buyer because they will have no legal protection for any potential title issues that could arise after the real estate transaction is complete.

## The Bottom Line

A warranty deed offers strong protection for real estate buyers by guaranteeing a clear title and no outstanding liens or mortgages from the seller. It ensures that the title is free from defects and protects buyers from future claims. Pairing a warranty deed with a thorough title search and title insurance offers buyers maximum protection and confidence in their real estate transactions.