{"id":1151,"date":"2020-12-25T11:00:07","date_gmt":"2020-12-25T16:00:07","guid":{"rendered":"https:\/\/www.deeds.com\/articles\/?p=1151"},"modified":"2024-04-25T23:20:05","modified_gmt":"2024-04-26T03:20:05","slug":"how-does-a-grant-deed-work","status":"publish","type":"post","link":"https:\/\/www.deeds.com\/articles\/how-does-a-grant-deed-work\/","title":{"rendered":"How Does a Grant Deed Work?"},"content":{"rendered":"\n<figure class=\"wp-block-image aligncenter is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.deeds.com\/articles\/wp-content\/uploads\/2020\/12\/how-does-a-grant-deed-work-1024x594.jpg\" alt=\"Image of a smartly dressed person reviewing a legal document, specifically a Grant Deed legal document.\" class=\"wp-image-1152\" width=\"1024\" height=\"594\" srcset=\"https:\/\/www.deeds.com\/articles\/wp-content\/uploads\/2020\/12\/how-does-a-grant-deed-work-1024x594.jpg 1024w, https:\/\/www.deeds.com\/articles\/wp-content\/uploads\/2020\/12\/how-does-a-grant-deed-work-300x174.jpg 300w, https:\/\/www.deeds.com\/articles\/wp-content\/uploads\/2020\/12\/how-does-a-grant-deed-work-768x445.jpg 768w, https:\/\/www.deeds.com\/articles\/wp-content\/uploads\/2020\/12\/how-does-a-grant-deed-work.jpg 1071w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>The title to a house can be conveyed from one owner to the\nnext by through a <a href=\"https:\/\/www.deeds.com\/articles\/property-title-deed-whats-the-difference\/\">transfer\nof a deed<\/a>. Different kinds of deeds provide different levels of risk\nfor the person acquiring the title. Among the various types of deeds, one with a\nmoderate level of risk is the <em>grant deed<\/em>.<\/p>\n\n\n\n<!--more-->\n\n\n\n<h2 class=\"wp-block-heading\">Why Use a Grant Deed?<\/h2>\n\n\n\n<p>If you are receiving a grant deed, it could be because\nyou\u2019re in California, where they are often used in sales. Perhaps you are\nreceiving property from a trust. Or perhaps you\u2019re buying the home in a\nforeclosure or a tax sale. <\/p>\n\n\n\n<p>In some states, the grant deed can be used in divorce\nsettlements. Grant deeds are also used to transfer property to a trust or LLC,\nfor multi-unit property sales, and when the transferor of the deed wants to\navert legal obligations for title defects possibly arising on the watch of a\nprevious owner. Often, the grant deed works to convey a title without\ntriggering a new property tax assessment. <\/p>\n\n\n\n<p>As a general rule, a grant deed offers stronger buyer\nprotection than a quitclaim, but carries a higher level of risk than a general\nwarranty deed.<\/p>\n\n\n\n<p>In some states, people refer to a grant deed as a <em><a href=\"https:\/\/www.deeds.com\/articles\/what-is-a-special-warranty-deed\/\">special warranty deed<\/a>.<\/em> These types are similar, though there are <a rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\" href=\"https:\/\/homeguides.sfgate.com\/california-allow-special-warranty-deeds-79968.html\" target=\"_blank\">nuanced and state-specific differences<\/a> and title companies in your state may classify the two as separate types<em>.<\/em> A&nbsp;<a href=\"https:\/\/www.deeds.com\/articles\/bargain-and-sale-vs-quitclaim-deeds-a-concise-guide\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">bargain and sale deed<\/a> can also resemble a&nbsp;grant deed, if it includes covenants. But bargain and sale deeds&nbsp;do not assure their recipients of clean titles.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What Protections Does the Grant Deed Offer?<\/h2>\n\n\n\n<p>A grant deed assures the recipient of just two protections: (1)\nthat the transferor of the deed did not already transfer the property title to\nsomeone else, and (2) that the property is free of liens and encumbrances,\nexcept as expressly stated in the deed. <\/p>\n\n\n\n<p>Thus, a grant deed: <\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>States that the title is conveyed free and clear\nof claims arising when the grantor (the transferor of the deed) held the title.<\/li><li>Asserts that all known liens and other encumbrances\non the property have been disclosed. In practical terms, this means the deed should\ndisclose any burdens of title created by the transferor: assessments; conditions,\ncovenants and restrictions; any liens and leases; easements, encroachments, and\nrights of way. No undisclosed taxes or other legal or financial issues may loom\nthat could make the property difficult to sell.<\/li><\/ul>\n\n\n\n<p>The grant deed<em> implicitly <\/em>conveys a free and clear\ntitle, as opposed to the warranty deed, which does so <em>expressly<\/em>. Yet\nwith the grant deed, claims could have arisen before the time the grantor held\nthe property. In contrast to the warranty deed, the grant deed does not compel\nthe grantor to step up and cover the costs of defending the title against those\nearlier and unexpected claims. <\/p>\n\n\n\n<p>In the next section, we take a closer look at the workings\nof the grant deed \u2014 particular as it is used in California.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What\u2019s in a Grant Deed?<\/h2>\n\n\n\n<p>Each state that recognizes grant deed has its own rules and\ncustoms. The home property\u2019s state and county control the required language,\nformat, and procedural rules. A typical deed shows the date, the property\ndescription, the parties\u2019 names and a statement conveying the title from\ngrantor to grantee (the \u201cgranting clause\u201d), and is signed by the grantor. Following\nbest practices, the grantor\u2019s transfer should be witnessed and notarized. The\ngrantee typically pays the county recorder a minor fee. <\/p>\n\n\n\n<p>To consider one state\u2019s example, a&nbsp;<a href=\"https:\/\/www.deeds.com\/forms\/florida\/grant-deed\/\">grant\ndeed&nbsp;in&nbsp;Florida<\/a> is allowed. Though it\u2019s rarely used, and not\nnamed as a Florida deed in the state\u2019s statutes, it may nevertheless be\nrecorded in Florida counties.<\/p>\n\n\n\n<p>In California, in contrast, there\u2019s a lot to say about grant\ndeeds, because grant deeds and quitclaims are generally considered the two key instruments\nfor real estate conveyances. As long as the term \u201cgrant\u201d appears in the\nconveyance provision on the deed, it is effective, once signed, delivered, and\naccepted. (The <a href=\"https:\/\/www.deeds.com\/quitclaim-deed\/\">quitclaim<\/a> is used\ninstead to transfer California property without assurances that the transferor\nactually holds a property interest.)<\/p>\n\n\n\n<p>So, we\u2019ll use California as an illustration of important\nfactors to consider and discuss with your real estate attorney when creating a\ngrant deed. <\/p>\n\n\n\n<p>California\u2019s Civil Code, <a href=\"https:\/\/codes.findlaw.com\/ca\/civil-code\/civ-sect-1092.html\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">Section 1092<\/a>,&nbsp;allows the use of this deed type. As the state sets forth: <\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>A grant deed\u2019s implied covenants are enforceable by the deed\u2019s named recipient \u2014 not later buyers. In contrast, easements and restrictions \u201crun with the land\u201d and do bind future owners. The conveyance should set forth the covenants that run with the land as binding those future buyers, also known as <em>remote grantees.<\/em><\/li><li>California further notes that any condition in the purchase agreement \u2014 for example, a reserved easement or a life estate \u2014 must be restated in (merged with) the grant deed to be enforceable against the title. The grant deed must be the only instrument through which the buyer and seller enforce their rights.<\/li><li>The California county assessor&#8217;s office accepts the deed for filing with the required fees and tax affidavit. If the property changes hands, expect a property tax reassessment. Transfers to joint owners and immediate family, or into trusts or LLCs, may obtain a reassessment exclusion, and the exemption should be stated on a preliminary change of ownership report (PCOR). File the deed and PCOR together. \u00a0<\/li><\/ul>\n\n\n\n<p>\u261b Specific language is necessary\nto create a valid grant deed in your state and county. We ensure the correct\nlanguage is included in our forms, making them valid where the property exists.\n<strong>See our downloadable <a href=\"https:\/\/www.deeds.com\/grant-deed\/\">grant deed forms<\/a> with step-by-step\ninstructions and sample finished deeds.<\/strong> <\/p>\n\n\n\n<p><strong><em>Note:<\/em><\/strong> For a valid grant deed, the whole property\nmust be transferred during the grantor\u2019s life, and the grantee must accept the\ndeed.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Limiting Risk With a Title Policy<\/h2>\n\n\n\n<p>A grant deed itself limits the recipient\u2019s risk in key ways.\nYet there is always the risk of a claim arising from a time before the transferor\nheld title. If that happens, what recourse will the new owner have?<\/p>\n\n\n\n<p>In California, buyers often depend on title insurance companies\nto guide real estate closings as well as to&nbsp;\noffer appropriate title policies. &nbsp;<\/p>\n\n\n\n<p>Buyers should strongly consider an owner\u2019s title insurance policy.\nThis is in addition to a lender\u2019s policy, which is required for a mortgage. <\/p>\n\n\n\n<p>Title insurance companies research the chain of title to\ncheck that it has been correctly transferred. This search is a vital safeguard.\nYet title searches can and do miss issues. Should that occur, the owner\u2019s <a href=\"https:\/\/www.deeds.com\/articles\/category\/title-insurance\/\">title insurance\npolicy<\/a> will back the owner who needs to remedy any defects.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">To Sum It Up\u2026<\/h2>\n\n\n\n<p>Through the grant deed, a new owner takes over a property title,\naccepting the express exceptions set forth on the deed. Parties who transfer the\ntitle with a grant deed are assuring the recipient that they have not created\nany title problems. Yet they do not make assurances regarding anything that\ncould have occurred before they held the title.<\/p>\n\n\n\n<p>A grant deed offers <em>less<\/em> protection than the warranty\ndeed, by which the grantor guarantees the title against all claims. A grant\ndeed offers <em>more<\/em> protection than a quitclaim, which simply transfers any\ninterest in a property that a transferor might have.<\/p>\n\n\n\n<p>When deciding whether to accept a deed that carries more\nrisk that a general warranty deed, consult with a title insurance expert and a\nlocal residential real estate lawyer. When accepting a grant deed in places\nwhere it isn\u2019t customary, this is especially important.<\/p>\n\n\n\n<p><strong>Supporting References<\/strong><\/p>\n\n\n\n<p class=\"has-small-font-size\">First Tuesday Journal: <a href=\"https:\/\/journal.firsttuesday.us\/brokerage-reminder-the-grant-deed-vs-quitclaim-deed-deeds-of-conveyance\/50056\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">Brokerage Reminder: Grant Deed Vs. Quitclaim Deed \u2013 Deeds of Conveyance<\/a> (Nov. 2020).<\/p>\n\n\n\n<p class=\"has-small-font-size\">And as linked. Photo credit: <a href=\"https:\/\/www.pexels.com\/@olly\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">Andrea Piacquadio<\/a>, via Pexels. <\/p>\n","protected":false},"excerpt":{"rendered":"<p>The title to a house can be conveyed from one owner to the next by through a transfer of a deed. Different kinds of deeds provide different levels of risk for the person acquiring the title. Among the various types of deeds, one with a moderate level of risk is the grant deed.<\/p>\n","protected":false},"author":2,"featured_media":1152,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[120],"tags":[],"class_list":["post-1151","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-grant-deed"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>How Does a Grant Deed Work? - Deeds.com<\/title>\n<meta name=\"description\" content=\"As a general rule, a grant deed offers stronger buyer protection than a quitclaim, but carries a higher level of risk than a general warranty deed.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.deeds.com\/articles\/how-does-a-grant-deed-work\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How Does a Grant Deed Work? 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