Understanding Deed Types and Their Implications

A deed is the legal document that transfers ownership of real property from one party to another. The type of deed used in a transaction determines the level of protection the buyer receives regarding the quality of title being conveyed.

General warranty deed provides the highest level of protection. The seller (grantor) guarantees that they hold clear title, have the right to sell, and will defend the title against all claims — including claims arising from before the seller owned the property. This is the standard deed type for most residential sales and the one you should expect when purchasing a flip.

Special warranty deed (also called limited warranty deed) provides a lesser guarantee. The seller only warrants against title defects that arose during their ownership period. Any issues from before they acquired the property are not covered. This deed type is common in foreclosure sales and bank-owned property transactions.

Quitclaim deed provides no warranties whatsoever. The seller simply transfers whatever interest they may (or may not) have in the property. This deed is commonly used between family members, to clear title defects, and in some distressed property transactions. Buying with a quitclaim deed means you accept all title risks.

Bargain and sale deed falls between quitclaim and warranty deeds — it implies the seller has title but doesn't guarantee against encumbrances or defects.

For investors, the deed type matters most in distressed transactions. When buying from a bank (REO), expect a special warranty deed. When buying at a tax sale, you may receive a tax deed (which varies by jurisdiction in the protection offered). When buying from a wholesaler via assignment, the deed type in the original contract controls.

Always review the deed before closing. Verify the legal description matches the property, the grantor matches the current titleholder, any deed restrictions or conditions are acceptable, and the deed type provides adequate protection for the transaction type. Title insurance supplements deed protections but shouldn't be your sole safeguard.