Ggovire
GlossaryTitleConveyance

Deed of conveyance

2 min read
Short answer
A deed of conveyance is the instrument transferring an interest in real property. It names the grantor and grantee, describes the land, states the consideration, and is signed and acknowledged. It takes effect on delivery to the grantee, and is recorded so that the transfer binds people who were not party to it.

A deed of conveyance is the written instrument by which an interest in real property passes from one party to another.

Everything else in a transaction — the purchase agreement, the financing, the title work — leads to this document.

What it must contain#

Identifiable grantor and grantee. An adequate legal description. Words of conveyance showing an intention to transfer. The grantor's signature, properly acknowledged before a notary.

In Minnesota, recorded deeds also carry practical requirements: the drafter's name, an address for tax statements, and formatting the county will accept.

Delivery#

The step people miss, and it is what makes a deed effective.

A deed takes effect on delivery — the grantor parting with control of it with the intention that it operate. Signing is not delivery. A signed deed in a safe deposit box, intended to take effect when the owner dies, has generally not been delivered and may convey nothing.

That misunderstanding causes real damage in family situations, where a parent signs a deed to a child and holds onto it. The correct instrument for that intention is a transfer on death deed, which is recorded during life and operates on death.

The forms, from strongest to weakest#

Warranty deed. The grantor warrants title against all defects, including those arising before they owned it.

Limited warranty deed. Warrants only against defects arising during the grantor's ownership.

Quitclaim deed. Conveys whatever interest the grantor has, with no promise that they have any.

Personal representative's deed, sheriff's deed, and similar. Conveyances by authority rather than by an owner, carrying limited or no warranties, and depending for their effect on the authority behind them.

What that means for distressed property#

Distressed transactions run on the weaker forms almost exclusively.

A bank selling foreclosed property conveys by limited warranty or special warranty at best. An estate conveys by personal representative's deed. Tax forfeited land comes by state deed. A family sorting out an inherited house conveys by quitclaim.

None of those carry the assurances a warranty deed does, which shifts the entire burden of title risk onto the buyer's title examination and title insurance.

That is not a reason to avoid such purchases. It is the reason an owner's title policy is not optional on them.

Deed and title#

A deed conveys; it does not create good title.

A perfectly drafted, properly delivered, promptly recorded deed from someone with defective title transfers that defective title. The document being right and the title being good are two separate questions, and only the title examination answers the second.

Common questions

What makes a deed valid?
Broadly: identifiable parties, an adequate description of the property, words of conveyance, the grantor's signature properly acknowledged, and delivery to the grantee. Recording is not required for validity between the parties, but is what protects the transfer against everyone else.
What is delivery?
The grantor parting with control of the deed with the intention that it take effect. A signed deed sitting in a drawer has generally not been delivered, which is why deeds intended to take effect on death should use a transfer on death deed rather than a signed deed held back.
Which type of deed should I use?
It depends on what the grantor is willing to promise. A warranty deed carries the fullest assurances, a limited warranty covers only the grantor's own period of ownership, and a quitclaim promises nothing. Distressed transactions overwhelmingly use the weaker forms.
Keep reading
Grantor
The party conveying an interest in real property, named in the deed as the person or entity giving up what is being transferred.
Grantee
The party receiving an interest in real property under a deed, whose name and vesting language determine how the interest is held going forward.
Deed recording
Filing a deed in the public record so the transfer is effective against third parties, done through the county recorder or the registrar of titles.