Buying a home is an investment. Being one of the largest investments you make during your lifetime, you want to make sure that the legal documents about the sale and purchase of your home are properly prepared and recorded. 

This, in turn, requires that you have a basic understanding of the following three crucial real estate terms:

1. Title
2. Deed
3. Recording

1. Title

Title refers to who owns the property and the way in which they own it. In general, title takes one of the following forms:

• Sole ownership: You own the property all by yourself.
• Joint tenancy: You own the property with one or more people, with each of you owning equal shares of it.
• Tenancy in common: Similar to joint tenancy, except that each of the tenants in common may own a different proportion of the property.
• Tenancy by the entirety: A special type of joint tenancy available only in 25 states and then only to married couples or possibly couples in a registered domestic partnership.

Each of these ownership forms has its own advantages and disadvantages. In addition, each state has its own laws and other requirements.

2. Deed

While title determines who owns the property and how, deeds are the legal documents that transfer the property from the seller or sellers to the buyer or buyers.

Deeds also come in several different types, with the most common being:

• General warranty deed: The seller warrants and covenants, i.e., promises, numerous things to the buyer, such as as them having clear title to the property, that there are no encumbrances against it, etc.
• Special warranty deed: The seller warrants only that they received clear title to the property and did nothing while holding such title that caused a title defect.
• Quitclaim deed: The grantor (usually not a seller per se) warrants nothing to the grantee (usually not a buyer per se); rather the grantor merely conveys whatever interest in the property they currently own to the grantee.

3. Recording

One of the most important things to keep in mind when you enter into any real estate transaction is that, although ownership passes as soon as the seller or grantor signs the deed, the process is not yet finished. You must then record your deed in the office designated by your state, usually your county’s office of recorder of deeds.

Recording your deed gives the public notice of the property’s change of ownership and continues the legal chain of title. In all likelihood, your mortgage lender will require recording as a condition of providing the mortgage funds.

Bottom Line

If all of this seems complicated, it can be. That is why AmeriEstate Legal Plan, Inc. offers deed preparation and recording services in addition to our other estate planning services. In fact, we stand ready, willing and able to be your personal legal services resource whatever your needs may be and whenever they may arise.

Contact us today. We will be happy to answer all your real estate questions and provide you with the help you need to ensure that your deeds are correctly prepared and recorded.