When you are buying a home, it is important to know what kind of warranty the seller is offering. This is where a special warranty deed comes in handy. In this blog post, we will explain what a special warranty deed is and what it means for you as the buyer. We’ll also provide an easy guide on how to understand this type of warranty. So, whether you are a first-time homebuyer or just need a refresher, read on for all the details!
What Is a Special Warranty Deed?
A special warranty deed is a type of deed that provides certain protections to the buyer. With this kind of deed, the seller is warranting that they have not done anything to damage the property during their ownership. Additionally, the seller promises to fix any defects that may arise due to their actions while they owned the home. There is also a general warranty deed, which provides even more protection to the buyer. However, this type of deed is less common and typically only used in commercial transactions. The main difference between these two is that a general warranty deed protects against any type of damage that may have occurred during the seller’s ownership, while a special warranty deed only covers damage that the seller is responsible for.
What Does a Special Warranty Deed Mean for You?
As the buyer, a special warranty deed means that you can have peace of mind knowing that the property is in good condition. Additionally, if any problems do arise, the seller is responsible for fixing them. However, it is important to note that this type of deed does not cover any damage that may have occurred before the seller owned the property. So, if you are buying an older home, be sure to get a home inspection to identify any potential issues.
How Does This Affect You as the Buyer?
As the buyer, it is important to know what kind of protection you are getting with your purchase. If you are buying a home with a special warranty deed, you can rest assured knowing that the seller is responsible for any damage they may have caused. However, be sure to get a home inspection to identify any pre-existing problems. For example, if you are buying an older home, you will want to make sure that there are no hidden defects that could cause problems down the road.
What Must Be Included in a Special Warranty Deed?
In order for a deed to be considered a special warranty deed, it must include certain language. This language typically includes a clause that outlines the seller’s responsibility for any defects or damage that they have caused. Additionally, the deed must be properly executed and delivered to the buyer. Furthermore, the seller must have the legal right to sell the property in order for the deed to be valid.
When a Special Warranty Deed Is Used
A special warranty deed is typically used in residential transactions. However, it can also be used in commercial transactions. This type of deed is less common in commercial transactions, but it can be used if both parties agree to it.
Special Warranty Deed and Title Insurance
When you purchase a home, you will also need to purchase title insurance. This insurance protects you from any defects in the title that may have gone undetected. It is important to note that a special warranty deed does not replace the need for title insurance.
What Are the Risks Of a Special Warranty Deed?
As with any legal document, there are certain risks associated with a special warranty deed. For example, if the seller does not have the right to sell the property, the deed is not valid. This means that you, as the buyer, would not have any protections. Additionally, if the deed is not properly executed or delivered, it may also be invalid. So, it is important to be sure that you understand the risks before signing any legal documents.
Who Benefits the Most From a Warranty Deed?
A warranty deed is beneficial for both the buyer and the seller. For the buyer, it provides certain protections and peace of mind. For the seller, it limits their liability in the event that something goes wrong. So, if you are considering a purchase, be sure to ask the seller if they are willing to provide a special warranty deed.
Warranty Deed vs. Deed Of Trust
A warranty deed and a deed of trust are two different types of legal documents. A warranty deed is used in a purchase transaction, while a deed of trust is used in a loan transaction. The main difference between these two documents is that a warranty deed provides certain protections to the buyer, while a deed of trust does not. For example, if the seller does not have the right to sell the property, the buyer is not protected under a deed of trust. Or, if the language in the deed is unclear, the buyer is not protected.
Can Someone Sell a House If Your Name Is On the Deed?
If your name is on the deed to a property, you have the legal right to sell it. However, there may be other individuals who also have an interest in the property. For example, if you are married, your spouse may also have an ownership interest in the property. As such, you would need their permission to sell the property. Additionally, if you have a mortgage on the property, the lender would need to approve the sale.
While a special warranty deed is not required by law, it is typically used in most home sales. This is because it provides certain protections to the buyer that they would not otherwise have. So, if you are in the market for a new home, be sure to ask the seller if they are offering a special warranty deed. Also, be sure to get a home inspection and purchase title insurance to protect yourself from any hidden defects.
We hope this guide has helped you to better understand what a special warranty deed is and how it works. Thanks for reading.