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General warranty deed protects new property owners

Dear Lawyer Mark: We are trying to sell our house, and I have been reading through the paperwork our realtor gave us.
One of the things listed in the contract is that when we agree with everything with a buyer, we have to sign a “general warranty deed.”
What does this mean, and are there other types of deeds? — Curious in Kitts Hill
Dear Curious: There are several types of deeds that a person can use to sell property, and each type of deed comes with different protections.
The “general warranty deed” that you speak of is the most commonly used deed when someone is selling real estate.
When you sell a property with general warranty covenants, you are guaranteeing that you actually own the property, that you have the right to sell the property, and that there are no mortgages or leases or other “encumbrances” against the property.
Most importantly, you are also guaranteeing that if a problem is found with the title after you sell it and someone is making a claim against the property, you will step in and defend the lawsuit, as well as pay the buyer any damages.
How could this occur?
If you inherited your property from a parent and didn’t know they had a valid mortgage against it, and then sold it with general warranty covenants to someone, you would be responsible for the cost to defend a later foreclosure suit, and for paying any amounts the buyer had to pay due to the mortgage.
Another type of deed is referred to as a “limited warranty deed.”
With this type of deed, the seller guarantees that there are no encumbrances against the property caused by the seller, but he is not making any promises about the condition of the title and encumbrances that arose before the seller owned it.
In the example above, the seller would not be liable for the mortgage issue, because it arose before he owned the property.
The least protection offered by a deed is that of a “quit-claim deed.”
A quit-claim deed transfers any ownership interest the seller has at the time he signs the deed, but makes no promises or guarantees as to the condition of the title to the property or that there are any mortgages or other encumbrances, and in fact doesn’t even guarantee that the seller owns the property to begin with.
A seller could legally sign and give someone a quit-claim deed to property that the “seller” doesn’t even own, and not be sued under the terms of the deed when the buyer finally realizes he didn’t actually receive the property.

Thought for the Week: “Democracy is when the indigent, and not the men of property, are the rulers.” Aristotle.

It’s The Law is written by attorney Mark K. McCown in response to legal questions received by him. If you have a question, please forward it to Mark K. McCown, 311 Park Avenue, Ironton, Ohio 45638, or e-mail it to him at LawyerMark@yahoo.com. The right to condense and/or edit all questions is reserved.