Special Warranty Deed vs. Warranty Deed! Which One Do You have?

by Teri Ellis on October 13, 2010

I recently “happened” upon an article discussing the differences between a Special Warranty Deed and a Warranty Deed. I began to wonder? In our real estate markets, do those purchasing a property understand just how each of these Deeds protect them or not? The simple explanation?

A Special Warranty Deed is not the “standard” for homes – BUT we’ll use the bank owned properties as one example: Often, when purchasing a bank owned home, the bank will provide a Special Warranty Deed – as a protection to the bank just in case there is ever a title defect BEFORE the bank acquired the home at the foreclosure. This Deed only warrants title for the time period in which the seller (“bank”) owned the real property.

In Arizona, a Warranty Deed is the standard in our market indicating that the seller “warrants” that the title being transferred to the buyer by the seller is valid and free of any title defects back to the “beginning of time.”

Arizona’s standard residential contract provides for a general warranty deed from the seller. As a buyer, it is extremely important to utilize the services of experienced real estate professionals. As a seller, are you willing to “warrant” back to the beginning of time, that you are selling your home free of any title defects? BE sure to utilize the services of a good title company that will protect you.

So, whether buyers purchase a bank owned or a seller owned property, generally the title insurance covers any defect in title. This is yet one more reason to have good title insurance.

  • Title Insurers in Talks With Lenders on Warranties (businessweek.com)
  • The ABC’s of Deeds (stroupecondoblog.com)
  • Bought a foreclosure? Have title insurance? (sfgate.com)

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