Special Warranty Deed

What is a special warranty deed?

A special warranty deed is a legal document used in real estate transactions to transfer property ownership from a seller (grantor) to a buyer (grantee) with limited guarantees about the property's title. Namely, the seller guarantees that the property was free from encumbrances or title defects only during their ownership period. This means the seller is responsible for resolving any issues that arose while they owned the property. While it offers some assurance regarding the property's title, it provides less protection than a general warranty deed, as it does not cover issues that may have existed before the seller's ownership.

Why use a special warranty deed?

Special warranty deeds restrict the seller's liability to issues that arose during their ownership period, shielding them from potential claims or defects that existed before they owned the property. These deeds can be more cost-effective compared to general warranty deeds, as they require less extensive title research and may reduce the need for comprehensive title insurance. 

Special warranty deeds offer a balance between providing some protection for buyers and limiting the seller's liability, making them suitable for specific situations where comprehensive warranties are not necessary or desired.

Special Warranty Deed Guide

Property deeds are useful for quickly and easily transferring title to real estate to a new owner. LegalNature's property deed form allows you to draft the right deed for your needs.

Number of Grantors and Grantees

Remember, the grantor is the party that owns the property and is selling or transferring it to the grantee, or buyer. Grantors and grantees may be either individuals or business entities.

Grantor and Grantee Types

You will need to specify whether each grantor and grantee is a married individual, a non-married individual, a trustee, or a business.

If a party is receiving the property as a trustee, then the trustee should be named as the grantee, not the trust itself. The deed will state that the trustee is receiving the property on behalf of the trust. If there are multiple co-trustees, you may list the name of any one of the trustees.

If a business is receiving the property, then you will name the business as the grantee and enter the name of the agent who will sign on behalf of the business. The agent should be someone with proper authority to sign binding contracts on the behalf of the business, such as an owner, executive, or manager.

Grantee Ownership Type – Sole Owner or Co-Owner?

You will be asked whether the grantee or grantees are receiving title as sole owners or co-owners. You should select "sole owner" only if no other person will share ownership with the grantee after the deed is signed. Select "co-owner" if more than one person or business will share ownership of the property with the grantee after the deed is signed. This would be the case, for example, if the grantor is a tenant in common and is transferring his or her interest to the grantee. The other tenants in common would not necessarily join in the deed as grantors, since only the grantor is changing his or her interest.

Grantee's Property Interest

Here you should indicate what type of joint property interest the grantees are receiving. Depending on your state, you can choose between a tenancy in common, a joint tenancy, a tenancy by the entirety or community property interest, and a partnership.

Tenancy in Common

A tenancy in common is a joint property interest in which each tenant (property owner) owns an undivided share in the whole property. Each tenant may transfer his or her interest without the need for the other tenants to join in the deed. When a tenant dies, his or her share passes according to their will or under state intestacy law when no will exists. Multiple businesses sharing ownership often choose to own as tenants in common due to the simplicity and flexibility of these ownership interests.

Joint Tenancy

A joint tenancy is the same but with a few important differences. First, each tenant owns an equal interest. So if there are four joint tenants, then each has a 1/4 ownership interest in the property. Also, a joint tenant may not sell or transfer his or her interest without the consent of the other tenants. This means that all joint tenants must sign as grantors when transferring or changing ownership and must sign together as grantees when receiving ownership. Lastly, each tenant has the right of survivorship, so when a joint tenant dies, his or her interest automatically passes to the other joint tenants in equal shares.

Tenancy by the Entirety

Tenancy by the entirety and community property interests are basically identical in nature and only differ in name. They are both similar to a joint tenancy but are for married couples. The same rules apply, including right of survivorship.

Final Steps

Remember to record your deed with your local land title office, usually known as the County Recorder’s Office or County Clerk’s Office. Each county has its own unique filing requirements. Therefore, we recommend contacting your office by phone or email in order to verify that you have met their requirements.

• Be sure not to write in the margins of the pages of your deed, as your office may need to write in these. Most counties want at least a three-inch margin at the top of the first page for official use, often to stamp the date recorded.
• Do not staple the pages of your deed together.
• All signatures on the document must be originals—not copied, printed, or stamped.