Types of property deeds
There are quite a few different types of property deeds, each with its unique purpose and characteristics. We offer seven types of deed document templates:
1. Warranty Deed
A Warranty Deed guarantees that a property’s title is free from encumbrances while transferring its ownership. Warranty Deeds are used in most home sales between unrelated parties because they offer the most protection for buyers without established trust. If any title issues arise after a sale, a Warranty Deed ensures that the seller remains responsible.
There are two types of Warranty Deeds: special and general.
Under a special Warranty Deed, the grantor guarantees that they have done nothing during their period of ownership that would create defects on the property title but provides no guarantees to the title before their ownership. In this sense, a special Warranty Deed provides a limited guarantee.
In contrast, a general Warranty Deedguarantees that no encumbrances exist. The grantor takes responsibility for any prior claims or liens that could be found later. Buyers or recipients of property who want the utmost protection should request a general Warranty Deed.
2. Quitclaim Deed
A Quitclaim Deed does not guarantee that a property’s title is free from encumbrances while transferring its ownership, meaning there could be liens or other claims against the property that cloud the title.
Because of the lack of guarantees, Quitclaim Deeds are quick and convenient ways to transfer property ownership. They are mostly used for transfers that do not include a sales component.
People with trusted and established relationships, such as family members, commonly use Quitclaim Deeds. For example, an aging parent may use a Quitclaim Deed to easily transfer their house to their children. During or after a divorce, if one spouse is keeping the marital home, the other may use a Quitclaim Deed to transfer their ownership interest.
3. Survivorship Deed
A Survivorship Deed allows property owners to transfer real estate to multiple recipients, creating a joint tenancy. Under a joint tenancy, owners have the right of survivorship. This means that when one property owner dies, their ownership interest automatically transfers to the surviving owner(s). When one owner remains, they have sole ownership of the property. Because joint tenants have the right of survivorship, Survivorship Deeds can prevent a piece of real estate from having to enter the probate process after a joint owner passes away. Survivorship Deeds can be useful between spouses. Typically, spouses will be joint tenants when they buy a home together. However, if a newlywed owned a property before their marriage and wants to transfer half its ownership to their spouse, they can use a Survivorship Deed. A parent may use a Survivorship Deed to add their adult children’s names to their property title. Once the parent passes, the property will already belong to the children without the involvement of the parent's Last Will and Testament or Living Trust. Survivorship Deeds can be used in every state except Louisiana.
4. Gift Deed
A Gift Deed allows a person or organization to transfer money or property as a gift. In terms of property, a Gift Deed can transfer a house, a car, shares, and more. Gift Deeds facilitate the transfer of ownership and show that a gift is being given without payment in return.
It is very common for people to use Gift Deeds to transfer a gift to a family member, such as a parent gifting a house to a child. Also, people can use Gift Deeds to donate substantial sums of money or valuable assets to charities.
There are two types of Gift Deeds: revocable and irrevocable. A revocable Gift Deed is one you can cancel in the future. An irrevocable Gift Deed can't be canceled or withdrawn.
5. Contract for Deed
A Contract for Deed is not a true property deed. Instead, as its name suggests, it’s a contract that binds a seller to use a deed to transfer a property in the future. When a real estate owner is selling their property and allowing their buyer to pay them in installments, a Contract for Deed allows the owner to keep the property’s legal title under their name while the buyer makes payments. When a seller accepts payment in installments, it is called seller financing. Under a Contract for Deed, the buyer obtains the equitable title while paying back the seller. This is not the same as having a legal title. Equitable title is the right to possess a property and eventually obtain ownership. Therefore, the buyer has the right to live in the property, but the seller does not legally transfer the title until the purchase price is fully paid.
Contracts for Deed are common when buyers cannot obtain financing through traditional methods, like a bank.
6. Deed of Trust
A Deed of Trust transfers a property’s legal title to a neutral party while a buyer pays back their lender. This type of deed involves a lender, a borrowing buyer, and a trustee.
Most people who are buying real estate have to borrow money or take out a mortgage to do so. Lenders have to protect their interests in case a borrowing buyer ends up defaulting on their loan. Documents like Deeds of Trust allow lenders to ensure they will be reimbursed—even if the buyer cannot pay.
With a Deed of Trust, the buyer often gives the lender a Promissory Note when the lender provides the loan. As collateral, the buyer uses the Deed of Trust to transfer the property’s legal title to a third-party trustee. If the buyer defaults on the loan, the trustee can take the property and use it to pay back the lender. Not all states use Deeds of Trust. In some states, people have to use Mortgage Agreements instead.
The following states use Deeds of Trust:
- Alaska, California, Colorado, District of Columbia, Georgia, Hawaii, Idaho, Maine, Massachusetts, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New Hampshire, North Carolina, Oregon, Rhode Island, Tennessee, Texas, Utah, Virginia, Washington, West Virginia, and Wyoming
The following states use Mortgage Agreements:
- Connecticut, Delaware, Florida, Iowa, Indiana, Kansas, Louisiana, New Jersey, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, Vermont, and Wisconsin
The following states allow either Deeds of Trust or Mortgage Agreements:
- Alabama, Arizona, Arkansas, Illinois, Kentucky, Maryland, Michigan, Montana, New Mexico, New York, and South Dakota
7. Deed of Reconveyance
A Deed of Reconveyance transfers a property’s legal title from the trustee to the borrowing buyer, once the buyer fully pays back the loan.
Deeds of Reconveyance are the counterpart to Deeds of Trust.
Deeds of Reconveyance have to be filed and recorded. A Deed of Reconveyance shows that the lender no longer has a security interest in the home. Once the buyer has received a Deed of Reconveyance, the trustee loses the right to claim the property on behalf of the lender.
In states that allow Mortgage Agreements, people must use a Satisfaction of Mortgage rather than a Deed of Reconveyance.