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What is the Difference Between Quitclaim Deeds & Grant Deeds?

The two most common types of property deeds are grant deeds and quitclaim deeds. Learn the differences between the two here.

Patrick Hicks

Patrick Hicks, @PatrickHicks

Head of Legal, Trust & Will

When you own the title to a property, more often than not, it’s because you obtained the deed to that property. A deed is a legal, written document that transfers the ownership of a property from a seller to a buyer. If the property is being given as a gift, then the two parties would be the owner and the grantee. In most states, the two most common types of deeds used to transfer property ownership are quitclaim deeds and grant deeds. Keep reading to find out the difference between quitclaim deeds vs grant deeds and to better understand which one would benefit you most. 

What is a Grant Deed?

Let’s start off with a definition of a grant deed. Mentioned above, a grant deed is one type of legal document that can be used to transfer property ownership. It’s an official record, and it guarantees that the title to the house will be granted to the individual who will be acquiring the house (whether through purchase or gift.)

Grant deeds should include some pertinent information such as the full legal name of the person handing over the property (grantor), the name of the person acquiring the property (grantee), and a full description of the property in question (including its address). The grantor must then sign the document in order for it to be legally valid.

The grant deed is also used to guarantee the title of the home to the new owner. For example, it will assure that the property is free and clear of any claims or liens. When the new owner receives the title to the property, they have the complete right to sell or transfer the property so they so choose. In simpler terms, the deed is guaranteeing that the new owner won’t face any ugly surprises. 

Is a Grant Deed the Same as a Quit Claim Deed?

A grant deed is not the same as a quitclaim deed. They do share something in common: they are both legal documents that are used to transfer ownership in a piece of property from one individual to another.

However, they do have some differences. Whether you choose one or the other depends on your personal circumstances. The rest of this guide will discuss the differences between quitclaim deeds vs grant deeds so that you can get a better idea of which one you should be using.

For a more detailed definition, visit our quitclaim deed resource page. This next section will also give you an idea of what a quitclaim deed is, and how it’s different from a grant deed.

Grant Deed vs. Quitclaim Deed - What’s the Difference?

Grant deeds and quitclaim deeds serve the same purpose of transferring ownership of real property in a legal manner. Both are equally effective.

However, these two legal documents share two fundamental differences. The first difference is the level of warranty provided by the grantor regarding their interest in the property, or the ownership. As a result, the second difference is the level of protection provided to the grantee.

With a grant deed, the grantor is “granting” their interest in a property to the grantee. It is guaranteeing that the property hasn’t been transferred to any other grantee, and that it is free from any encumbrances, such as liens or taxes. If the grantee later finds out that an encumbrance on the property exists, they can then sue the grantor because they had breached the warranty provided by the deed. However, note that the grantor must have caused the encumbrance, or they cannot be held liable for it.

Similar to a grant deed, a quitclaim deed transfers all title and interest of a property between a grantor and grantee. However, the key word here is “interest.” A quitclaim deed only transfers the interest the grantor has, or doesn’t have, in the property. It does not provide warranty that the property is owned free and clear, and thus that it doesn’t have any encumbrances on it. Further, this means that a quitclaim deed does not provide the grantee with the same protections as a grantor deed. If a grantee later finds out that the property is tied to liens or taxes, they cannot hold the grantor personally liable or sue them.

Quitclaim deeds are more commonly used when there is a high level of trust, and no money is involved. For example, a spouse might use a quitclaim deed to divest their interest in a house when getting divorced. That way, the house will be fully owned by their former partner. In another example, a quitclaim deed is often used when an individual is transferring the ownership of their own home into his or her Trust. Curious to find out more about how this works? Visit our guide on how to transfer real estate into a living Trust

Quitclaim Deeds & Estate Planning - Get Started Today

Quitclaim deeds vs grant deeds: they perform the same function, yet they end up being used for very different purposes. Both types of legal documents serve the same function of transferring ownership of real property.

The fundamental difference between quitclaim deeds and grant deeds is the level of protection and warranty provided to the grantee. The grantor also experiences a stark difference in whether or not they can be held legally liable, if it turns out there are encumbrances on the property, or a portion of the interest in the property was already transferred to a different party. 

If you are in the process of acquiring property, demand a grant deed if you can. You will have better peace of mind that the property is owned free and clear, and doesn’t share interest with any other party. You will also have legal recourse if any issues arise. Always use a grant deed if you’re involved in what we call “arms-length” real estate transactions, or transactions in which you are buying property from a seller. It’s the better option in terms of legal protection.

Alternatively, a quitclaim deed is typically sufficient if the transfer of property is an estate planning manner. We mentioned some examples earlier, such as transferring property into a Trust, gifting property to a loved one, or dividing assets as a result of a divorce. 

Here is an easy  rule of thumb to help you remember which deed to use. If there is money involved in the transaction, use a grant deed. This is especially true with arms-length transactions. If there is no money involved (such as a gift from a loved one, giving up property due to a divorce, or transferring property into a Trust), then a quitclaim deed is typically the practical solution. 

Are you interested in transferring property into a Trust using a quitclaim deed? Trust & Will can help you with that! Click here to learn more.

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