National Real Estate Practice Exam

Which deed offers the greatest protection to the buyer?

1. Quitclaim Deed

2. Special Warranty Deed

3. Warranty Deed

4. Transfer on Death Deed

The correct answer is: Warranty Deed

The Warranty Deed offers the greatest protection to the buyer because it contains specific guarantees that the seller has a valid title to the property and the right to convey it. This type of deed provides assurances against any defects in title, which means that the seller is liable for any claims or issues that arise related to the title that may not have been disclosed at the time of the sale. In essence, the seller promises to defend the buyer against any future claims to the property made by third parties. Additionally, a Warranty Deed typically includes both a "general warranty" which protects against any title issues arising at any time, and also a "special warranty" covering only those issues that occurred during the time the seller owned the property. This comprehensive coverage gives the buyer a higher level of security compared to other types of deeds. In contrast, a Quitclaim Deed offers no guarantees about the title, and the grantor does not promise to defend against any future claims, providing minimal protection. A Special Warranty Deed offers limited protection, only defending the title against issues arising during the seller's ownership. A Transfer on Death Deed primarily allows for the transfer of property upon the death of the owner but does not provide the same guarantees about the title or