Home Buying in Greenfield>Question Details

Jaiyla, Home Buyer in Milwaukee, WI

How concerned should I be about a special warranty deed on a residential home?

Asked by Jaiyla, Milwaukee, WI Fri May 10, 2013

We are seconds away from accepting our counter offer, but they just stated that they are selling the property with a special warranty deed. The seller purchased the house from an auction, flipped it, and is now selling it. We have only been reading negative things about special warranty deeds online. When we questioned our realtor, she questioned the seller. They told us that it's just how the seller transfers the titles and it will be a free and clear title. Now, we should take that with a grain of salt? If it's free and clear, why isn't it a general warranty deed? We contacted a lawyer and he was worried about these circumstances too, but can't meet with us until after the counter offer expires. What do you think we should do?

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A General Warranty Deed is a type of deed where the grantor (seller) guarantees that he or she holds clear title to a piece of real estate and has a right to sell it to the grantee (buyer). The guarantee is not limited to the time the grantor owned the property—it extends back to the property's origins.

Whereas, a Special Warranty Deed, the seller (grantor) warrants or guarantees the title only against defects arising during his/her ownership of the property and not against defects existing before that time.

Perhaps you could accept the Counter Offer and Amend the Offer later, changing the type of deed -- if they'd be willing to do that. If there are other contingencies in the Offer, for example home inspection and financing, or appraisal contingency - this could buy you some time to get the legal advise you need to make a decision that best protects you.
1 vote Thank Flag Link Fri May 10, 2013
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