The term 'Deed' is included in the Laws & Regulations edition of the Financial Dictionary. Get your copy on Amazon in Kindle, Paperback or Audio edition. Choose your edition here...
A Deed refers to a legal document which allows for a real estate ownership transfer from one party to another. Within the document will always be the names of the new and old owners of the property as well as the legally binding description of said real estate. The document must be signed over by the individual who is selling the property to the buyer.
It is impossible to transfer ownership of a piece of real estate unless you have a document in writing. This is nearly always the deed. Interestingly enough, there is not simply one type of these deeds. There are quitclaim, warranty, grant, and transfer on death kinds of deeds in existence. Each of them has their own reason of use.
Quitclaim deeds are what many individuals regard as basic deeds. They simply transfer over any ownership stake an individual may have in a given property. These do not define the full percentage of the receiver’s interest in the property however. They are often utilized by couples getting divorced. One of the aggrieved parties signs off on his or her full rights in the married couple’s joint properties to the other party. This is particularly helpful when a lack of clarity exists on an interest in a property that one of the owners (like a spouse) has in his or her name. Quitclaims never absolve the forfeiting party from the co- responsibilities of the mortgage however.
These Quitclaim deeds are also employed when title searches discover that a prior owner or heir to an estate possesses a partial claim on the real estate in question. That individual is able to sign off on such a quitclaim deed in order to allow for the transfer of whatever interest remains to them in the said property.
Warranty deeds provide ownership transfer along with a good guarantee that the transferring party possesses clean title on the real estate. This means that the purchaser can have confidence in the property being completely free of ownership claims or liens. These deeds deliver a guarantee from the sellers that they will provide compensation to the purchasers should this pledge prove to be incorrect. It is also possible for warranty deeds to provide other guarantees that address other potential issues with the real estate transfer transaction.
Grant deeds are those kinds that imply certain pledges along with transferring the ownership of title to the property. These pledges might include that the title is not encumbered or has not previously transferred over to someone else.
Finally, TOD Transfer on Death deeds are much like regular formats of deeds. Their critical difference is that they only go into effect when the owner of the property in question dies. In other words, they permit property holders to will real estate to an heir without having to become involved in proceedings in probate court. Upon death, the deed-named beneficiary will immediately assume ownership of the real estate. This avoids any and all delays and probate paperwork.
Creating such TOD deeds is not any more difficult than completing normal deeds. The owner simply designates the beneficiary, signs said deed, has it notarized, and records it with the appropriate property records office for the given jurisdiction. Such deeds are permitted in 23 different states. These include Wyoming, Wisconsin, Washington, Virginia, South Dakota, Oregon, Oklahoma, Ohio, North Dakota, New Mexico, Nevada, Nebraska, Montana, Missouri, Minnesota, Kansas, Indiana, Illinois, Hawaii, Washington District of Columbia, Colorado, Arkansas, and Arizona.
Deeds are required by law to first be notarized (and sometimes also witnessed) before being filed in the area public records office. The appropriate local records office is typically called either a Land Registry Office, County Recorder’s Office, or Register of Deeds. This office is typically located within the county courthouse.