Deeds

Deeds are used to convey title to real estate from a seller to a buyer.  The deed will always provide a property description but does not necessarily provide the purchase price of the property.  In New Hampshire, the purchase price is not included in the deed; in Massachusetts the price is included.

There are three types of deeds that are generally used in real estate transactions and it is important to understand the differences.

1) Warranty

A warranty deed conveys title to property with a warranty that the seller has the right to sell the property and that the title to the property is free from all encumbrances or other interests, except as may be stated in the deed.  A warranty deed is one in which the grantor warrants and agrees to defend the title against the claims and demands of all persons, whether such claims or demands arose during the seller’s ownership or the ownership of prior titleholders.  In New Hampshire, a warranty deed is governed by RSA 477:27.  In Massachusetts, M.G.L. ch. 183, § 10 governs General Warranty deeds.

Warranty deeds come with specific assurances of the title to the land, which are called covenants of title.  The six covenants are:

• • • Covenant of Seisin – The covenant of seisin is a covenant that the seller has the estate or interest that they purport to convey.
    • Covenant of Right to Convey – The covenant of the right to convey is a covenant that the seller has the power and authority to make the grant.
    • Covenant Against Encumbrances – The covenant against encumbrances is a covenant assuring that there are no encumbrances against the title or interest conveyed.
    • Covenant for Quiet Enjoyment – The covenant for quiet enjoyment is a covenant that the buyer will not be disturbed in their possession or enjoyment of the property by a third party’s lawful claim of title.
    • Covenant of Warranty – The covenant of warranty is a covenant wherein the seller agrees to defend on behalf of the buyer any lawful or reasonable claims of title by a third party, and to compensate the buyer for any loss sustained by the claim of superior title.
    • Covenant for Further Assurances – The covenant for further assurances is a covenant to perform whatever acts are reasonably necessary to perfect the title as the buyer may reasonably require.

2) Quitclaim

Like a warranty deed, a quitclaim deed conveys title to property with a warranty that the seller has the right to sell the property and that the title is free from all encumbrances or other interests, except as may be stated in the deed.   However under a quitclaim deed the seller only agrees to warrant and defend the title against the claims and demands of persons claiming, by, through or under the seller, but not against those claims or demands arising from prior titleholders.  Thus if it is discovered that there is an undischarged mortgage of someone who owned the property before the seller owned it, then the seller is not liable.  These deeds are commonly used when transferring property to family members or when parties get divorced. New Hampshire statute RSA 477:28 governs quitclaim deeds.  In Massachusetts, M.G.L. ch. 183, § 11 governs quitclaim deeds.  

Although not governed by statute in either New Hampshire or Massachusetts, special warranty deeds have the same seller covenants as quitclaim deeds.

3) Fiduciary

Finally, fiduciary deeds are used when property is being conveyed by an estate or a trust.  The executor or trustee warrants that they have the authority to sell, and that in all of the seller’s proceedings in the sale of the property, the seller has complied with the requirements of the statue and the seller will warrant and defend the title against the claims of all persons claiming by, from or under the trustee or executor. Because the liability of the estate or trust is limited to claims brought by persons claiming by, from or under the trustee or executor, a fiduciary deed is similar to a quitclaim deed. New Hampshire statute RSA 477:30 governs fiduciary deeds.  

If you have questions about real estate transactions or deeds, our real estate team at Smith-Weiss Shepard Kanakis & Spony, P.C. can answer your questions.