Conveyancing involves the transfer of legal title to real estate from one party to another. Title is transferred through a written document called a deed. In the deed, the person transferring title to the property is the grantor. They convey the property to a grantee. The deed specifically references the property being conveyed through a detailed legal description of the property. A mere street address is sufficient to generally describe the property being conveyed, but it fails to state the exact location or dimensions of the property. A specific legal description should be in the deed of conveyance to avoid location or boundary line disputes.
There are two basic types of deeds. These are warranty deeds and quit claim deeds. Although different types of deeds, they retain common elements. Both show the date of the conveyance, the name of the grantor and name of the grantee. They’re required to be signed by the grantor. Grantor’s signature is almost always notarized. Both deeds must show operative words of conveyancing. Intent to relinquish present title must be shown. For a warranty deed, the words “conveys and warrants” are sufficient to pass title. For a quit claim deed, the words “conveys and quit claims” are satisfactory. The deed must also recite at least nominal consideration. In its simplest form, consideration is the legal term for payment. The last common element is that the deed must be delivered by grantor to grantee and accepted by grantee. Delivery and acceptance can be manifested in several different ways.
Unless the property is conveyed by quit claim deed, grantor ordinarily promises to convey title to the property free of any liens, clouds or encumbrances. If grantor conveys through warranty deed, clear title is warranted or guaranteed. That’s the purpose of title insurance.
Prior to closing, the title insurancee company has thoroughly searched the property to be conveyed for any title defects in the form of liens, clouds or encumbrances. A report is prepared by the title insurer. Through their lawyer, the grantor must satisfy any exceptions to clear title for the grantee that might appear in the title report.
Most conveyancing occurs at the offices of a title insurance company, the office of a lawyer, or at a real estate office. This is called a closing. In almost all instances, a representative from a title insurance company is present, as are grantor and grantee and/or their legal representatives. The actual closing involves a simultaneous exchange of legal documents required to effectuate the transaction. Payment is made at that time and grantor delivers deed and other documents to show clear title and memorialize the transaction. Grantor’s mortgage, if any, is paid off, real estate brokers’ commissions are paid, and grantor and grantee pay their other related costs of the transaction.
Unless otherwise provided for in a written agreement, grantee can take possession of the real estate immediately after closing. Grantee is now the legal owner of the property. The executed deed is taken to be recorded or registered. Transfer tax stamps are affixed to evidence payment of those taxes. Deed is then recorded or registered and returned to grantee.