Homebuying decoded: What is a warranty deed?

This important document is key to ensuring your new home is free of hidden claims and legal issues.

You’ve found the perfect home — or at least one that fits your budget and lifestyle — and your offer has been accepted. It’s an exciting moment, but the journey isn’t quite over yet.  

Buying a home isn’t just a simple transaction. It’s a maze of paperwork, financial decisions and legal details. Navigating it all with confidence can set you up for success, and knowing the right documents to look out for can make all the difference. 

One of those key documents is something called a warranty deed.  

What is a warranty deed?

A warranty deed is a legal document drafted by the seller that protects the buyer. It is a guarantee that the property is free from certain issues, including: 

1. Outstanding liens. These are legal claims a creditor may have on a property, often due to unpaid debts. 
2. Encumbrances. These are rights held by third parties that could affect the buyer’s use of the property.  
3. Other claims. These include any other claims on the property, except those explicitly mentioned in the deed. 

For example, sometimes a third party has an easement, which is a legal right to use part of the land for specific purposes, like if a neighbor has a right-of-way for a driveway or other access, or for utilities.  

Another potential issue is a mechanic’s lien, which may have been put in place if contractors or suppliers weren’t fully paid for work done on the property. Other claims could include unpaid taxes, fines for overdue homeowner association fees, unresolved inheritance disputes and undisclosed mortgages. 

In simple terms, a warranty deed ensures that once you purchase the property, there will be no surprises. It prevents any future claims from unknown third parties and guarantees that the transfer of ownership is clean and clear.  

How do you acquire a warranty deed?

It’s always wise to request a warranty deed during the homebuying process —especially as the buyer. Sellers often already have them in place to give potential buyers some assurances, and most lenders require them for properties they finance.  

For the seller, the process of acquiring a warranty deed begins with a title search, which is typically arranged by the lender’s attorney. This search involves reviewing public records to verify the property’s legal ownership and uncover any potential issues.  

The title search will look for things like unpaid property taxes, legal disputes, outstanding liens or restrictive covenants (for example, rules about land use, such as restrictions on raising chickens). It also provides a detailed history of previous ownership.

If the title search comes back clean — meaning the seller has full, unencumbered ownership of the property — then the warranty deed can be drafted. This document is usually prepared by a real estate agent, closing attorney or any other legal entity, and is presented at closing.  

The warranty deed includes a legal description of the property, as well as formal language to transfer ownership, and is signed and witnessed according to state laws. 

What is the difference between a warranty deed and title insurance?

These documents are similar but have different purposes. A warranty deed warrants, aka certifies, that there are no claims on the property you’re buying.  

Title insurance — which is issued by a title company, also after completing a title search and examining public records for any problems or errors — offers broader coverage. It protects you from incurring financial losses should issues arise, like fraud or the falsification of documents, putting those risks on the insurance company instead. 

What is the difference between a warranty deed and a quitclaim deed?

Unlike a warranty deed, a quitclaim deed transfers property without any guarantee about the seller’s ownership of the property or the condition of the title.  

For the most part, the person transferring the title of a property in a quitclaim deed does have ownership rights. But a quitclaim deed does not protect from any third-party claims of ownership because, legally, it doesn’t establish any ownership in the first place. 

Generally, quitclaim deeds are issued when property is transferred in non-sale situations — for example, to add a spouse to a title after marriage, remove a spouse from a title after divorce or transfer property from parent to child.  

If you are not personally related or married to the seller, it is generally advised that you draft a warranty deed as opposed to a quitclaim deed. The former will protect you legally and financially by stating that you are the owner, fair and square, and will indemnify the seller in the case of any future claims on the property. 

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