OVERVIEW OF PRACTICE
TYPES OF DEEDS
HOLDING TITLE
OVERVIEW OF PRACTICE
Our real estate practice encompassess the following areas:
Many of our clients have questions about the differences between the various types of deeds, and about how to hold title to property. We have provided a brief summary below. Please contact us or another attorney for specific advice applicable to your situation.
A deed is a written document which transfers title (ownership) or interest in real property to another person. The deed must be recorded in the office of the county clerk and recorder of the county in which the property is located. The type of deed used affects the rights the person acquiring the property (grantee) has against the person who transferred the property (grantor).
Quitclaim Deed: A quitclaim deed transfers whatever ownership interest the grantor has in the property. It makes no guarantees about the extent of the grantor's interest. The manner in which the grantee's name appears on the document is also important, since it may affect the form of ownership and the tax liability of the grantee.
Bargain and Sale Deed: A bargain and sale deed carries with it no warranties against liens or other encumbrances but does imply that the grantor has the right to convey title. It also conveys any "after-acquired" title, unlike a quitclaim deed. The grantor may add warranties to the deed at his discretion.
Special Warranty Deed: A special warranty deed is a deed in which the grantor warrants, or guarantees, the title only against defects arising during the period of his tenure and ownership of the property and not against defects existing before that time.
General Warranty Deed: A general warranty deed is a deed in which the grantor fully warrants good clear title to the property. The general warranty deed is used in most Colorado real estate deed transfers and offers the greatest protection to the grantee of any deed, although it often contains specific exceptions to the warranties.
Sheriff's Deed: A sheriff's deed is a deed given to a party on the foreclosure of property, after a judicial foreclosure on real property, or after a levy for monetary judgment against the owner of the property. The title conveyed is only that acquired by the state or the sheriff under the foreclosure and carries no warranties or representations.
Personal Representative's Deed, Trustee's Deed, and Conservator's Deed: These types of deeds are used when a fiduciary is transferring real estate on behalf of the owner. (A personal representative can sign a deed and transfer property on behalf of the estate of the deceased property owner; a trustee may transfer property on behalf of the trust beneficiary; a conservator may transfer property on behalf of the incapacitated person.) Generally, these deeds are similar to a special warranty deed. The grantee receives assurances that the personal representative, trustee, or conservator did not do anything to create defects in title; however, there is no warranty against defects that existed prior to the fiduciary taking title to the real estate.
Beneficiary Deed: A beneficiary deed is a deed that enables a grantor to convey title to the property to the grantee upon the grantor's death. This type of deed is used as an estate planning tool. Unlike the other types of deeds, the beneficiary deed does not transfer title or become effective until the grantor's death; therefore, the grantor may revoke the deed during his lifetime. The grantor also retains full power to convey, lease, mortgage, and encumber the property.
Deed of Trust: A deed of trust is a deed which transfers a lien interest in real property to a trustee to secure an obligation such as a promissory note or a mortgage. The trustee has the power to sell the property in the case of a default on the promissory note or mortgage. When the promissory note or mortgage is paid off, the lien is released.
Title to real estate may be held in many different capacities, such as individually, jointly with another person, or in a fiduciary capacity. If you hold title in your name alone, you alone own the entire interest in the real estate. Real estate titled in the name of more than one individual can be accomplished in several ways, each with a different legal effect.
Tenancy in Severalty: Tenancy in severalty means the ownership of the property is vested in one person alone (or entity, such as a limited liability company) rather than held jointly with multiple people.
Joint Tenancy: Joint tenancy means that each owner has an undivided interest in the whole property and each owner has the right of survivorship (the surviving owner(s) will automatically receive the deceased owner's interest upon this owner's death).
Tenancy in Common: Tenancy in common means that each owner has an undivided interest in the whole property and each owner's interest may be conveyed by deed or will. There are no survivorship rights between the owners, so a deceased owner's interest generally becomes part of that owner's estate.
In Trust: As part of estate planning, the real estate may be titled in the name of a trustee of a revocable or living trust. A trustee who holds title to real estate for another person's benefit can exercise the same rights that the person had in the real estate as the owner prior to transfer of the property to the trust, subject to any restrictions included in the trust document, and for the benefit of the beneficiary or beneficiaries named in the trust document.
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