Tuesday, April 26, 2011

What's In A Deed?

Image: luigi diamanti / FreeDigitalPhotos.net

Before we dive into the specifics of conveyance and deeds here are a few general terms to refresh your memory!

Deed: Written instrument duly executed and delivered by which the title to land is transferred from one person to another.

Grantee: In a deed, the person to whom the land is transferred. (Buyer)

Grantor: In a deed, the person who transfers the land. (Seller)

Conveyance: 1) A document which transfers an interest in real property from one person to another; e.g., a deed. 2) The act of executing and delivering a deed or mortgage.

In the State of Illinois, certain requirements must be met in order to properly transfer title to a new buyer. First, the seller must have the legal right to transfer the property, and a legitimate buyer to transfer the property to. Within the deed there must be a clause in which the seller (grantor) agrees to convey the property to the new buyer (grantee). You must also have a legal description or the physical description of the land which has either been obtained from a prior deed, new title commitment or new/existing survey. There must be a consideration, something of value, and the notarized signature of the grantor.

Types or Deeds

Warranty Deed: The most commonly used document for conveyance, wherein the seller (grantor) warrants and conveys to buyer (grantee). Seller is herein warranting (guaranteeing) ‘good and complete title’ to be conveyed.

Special Warranty Deed: Usually a deed of conveyance for a specific time of ownership wherein title is warranted.

Quit Claim Deed: A type of conveyance used to convey only a partial interest; usually means if I have an interest in this piece of property, I convey to you. Examples of when a Quit Claim Deed can be used: If a couple is divorcing, one spouse may transfer complete ownership to the other by a Quit Claim Deed. It can also be used if one individual gets married and wants to add his/her spouse to title. Another example is when one or more heirs transfer their ownership to another heir.

Trustee's Deed: If the ownership of a piece of property is held in a trust, rather than an individual, a trustee’s deed can be used to convey ownership to a new party.

Corporation Deed: If the property is owned by a corporation, rather than an individual, a corporation deed can be used in order for the corporation to convey ownership to a new party. In this case, the authorized party (i.e. president, vice president, board member) for the corporation must sign the deed.

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