Should I Use a Warranty Deed or a Quit Claim Deed?

Buying a home or other real estate is exciting, but it comes with a seeming blizzard of paperwork. One of the most important documents in the process is the Deed, which specifies ownership of the property. However, there are different kinds of Deeds; the most common are a Warranty Deed or a Quit Claim Deed. Here's what you need to know about the differences between the two.

What’s a Deed?

In general, a deed is the document used to transfer real property from one party to another.

What's a Warranty Deed?

A Warranty Deed also provides a number of guarantees from the seller to the buyer. It includes a full description of the property and asserts that the seller owns and can transfer full and clear title of the property. It also certifies that the property is free of any easements, liens, or other encumbrances on ownership.

What's a Quit Claim Deed?

Quit claim deeds are used when the transfer of ownership in the property does not occur as the result of a traditional sale, such as land conveyed through a Will or as a gift. Quit claim deeds contain no guarantees of any kind, which means that you could buy a property, receive a Quit Claim Deed, and later find out that the person you bought it from wasn't legally able to sell you the property at all.

What’s the Difference Between the Two?

When it comes to a Warranty Deed vs. a Quit Claim Deed, the central difference lies in the guarantees. Under a warranty deed, if it turns out that the property is not what the seller promised or there's an uncleared lien or other block to the title, the buyer can sue the seller and recover damages. Under a Quit Claim Deed, the buyer has no remedies. For this reason, a Warranty Deed should generally be viewed as more valuable than a Quit Claim Deed, though there are some special circumstances where that is not the case.

If you're not sure which type of deed to use, it's best to speak to a lawyer.