California Warranty Deed Form
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What is a California Warranty Deed Form?
A California warranty deed is a deed form that transfers real estate with a complete warranty of title. A warranty deed makes an absolute guarantee that the current owner who signs the deed (the transferor or grantor) has good title to the property. The warranty is not limited like some other deeds. It covers the property’s entire chain of title—not just the time while the current owner owned the property. This means that the transferor could be legally responsible for title issues that arose before he or she acquired the property.
How Warranty of Title Works in California
A warranty of title is guarantee a transferor gives to the transferee when signing a deed. A transferor who provides a warranty promises a valid, clear title and agrees to be legally responsible for any property title problems.
Warranties of title may be limited, meaning the guarantee covers only certain time periods or conditions. A California warranty deed form provides a complete warranty of title that covers all title problems that are not explicitly excluded from the warranty. The warranty consists of several promises—called covenants of title—that the current owner gives to the new owner.1 California warranty deeds typically include the following covenants from the transferor:
- Covenant of ownership (or covenant of seizin). The transferor holds legal title to the property.
- Covenant of right to convey. The transferor has the right to transfer the property to the transferee.
- Covenant of warranty. The transferor will be responsible for resolving any title problems.
- Covenant of quiet enjoyment. The transferee will have undisturbed ownership of the property.
- Covenant against encumbrances (also spelled incumbrances). No undisclosed liens, mortgages, or other adverse third-party interests (encumbrances) affect the property’s title.
- Covenant of further assurance. The transferor will sign documents or take any future action needed to confirm the transferee’s ownership and give effect to the other covenants.
California warranty deeds have no implied covenants of title, so a warranty deed’s covenants must be included in the deed’s written terms. The parties to a California warranty deed can adjust the deed’s covenants to reflect their agreed transfer terms.
How Warranty of Title Protects the New Owner
A warranty of title places the risk of title problems on the current owner who is transferring the property. Common sources of title problems include:
- Undisclosed liens, mortgages, or deeds of trust;
- Errors in prior deeds or other recorded documents that affect the property;
- Missing documents that cause a gap in the property’s chain of title;
- Lack of a right of way or easement giving the owner physical access to the property;
- Incomplete or flawed administration of an earlier owner’s estate; or
- Disputes over the property’s boundary with neighboring properties.
A transferor who gives a warranty is legally responsible for title problems and must compensate the transferee for any financial loss a problem causes.2 A transferee has a legal right to enforce the warranty—including by suing the transferor to recover the cost of removing an undisclosed lien.3
Other Names for a California Warranty Deed Form
In some states, the equivalent of a California warranty deed is called a general warranty deed. The longer name distinguishes warranty deeds that provide a full warranty from special warranty deeds (also called limited warranty deeds)—which give a limited warranty of title. The word general is not necessary in California because California deeds that provide a limited warranty of title are called grant deeds.
Some states use the name statutory warranty deed for deeds with a complete warranty of title. That name denotes that the deed’s warranty is based on a specific authorizing statute. California has no authorizing statute for warranty deeds, so statutory warranty deed is not a fitting name in California.
How Do California Warranty Deed Forms Relate to Other Forms of Deeds?
California warranty deeds provide a complete warranty of title that extends through the property’s entire history. The transferor therefore bears the risk for all title problems—except to the extent the deed expressly excludes a specific issue or condition. California recognizes two other types of deeds that are as effective as warranty deeds to transfer title but that allocate the risk of title problems differently.
California Quitclaim Deed
A California quitclaim deed form reverses a warranty deed’s risk allocation—shifting all risk of title problems to the transferee (the new owner). The transferor passes his or her entire interest in the property to the transferee but does not guarantee a good title. The transferee takes whatever interest (if any) the transferor can lawfully transfer. Because a quitclaim deed has no warranty of title, the transferee has no right to sue the transferor under the deed if there are title issues or if the transferor holds no actual interest in the property.
California Grant Deed
California’s other main type of deed—a California grant deed form—transfers property with a limited warranty that effectively divides the risk of title problems between the two parties.4 A warranty deed absolutely guarantees a good, clear title, but a grant deed guarantees only that the transferor has done nothing to harm the property’s title. A grant deed’s warranty covers issues that the transferor caused or allowed but does not cover anything that happened before the transferor acquired the property.
California Title Insurance and Warranty Deeds
California warranty deeds have become much less common in recent decades, and the guarantees they provide have mostly been replaced by title insurance. A title insurance policy insures against the risk of unknown problems with the property’s title. In exchange for a premium payment, the insurer contractually promises to compensate a transferee for any financial loss if a title problem arises.
In the real estate sale context, title insurance is usually a win-win for both parties.
- Title insurance is good for the transferor because it shifts risk from the transferor to the title insurance company. If it turns out that there is a title problem, the insurance company covers the financial loss and legal fees instead of the transferor.
- Title insurance benefits transferees because it provides greater financial certainty than a warranty deed. If there is a title problem, the transferee can file a claim with the title insurance company. A transferee protected only by a warranty deed must track down and sue the former owner—who might declare bankruptcy or otherwise lack resources to honor the warranty.
California law acknowledges the advantages of title insurance by requiring buyers in some transactions to receive written notice of the potential benefits of obtaining title insurance.6
California Warranty Deeds and Other California Deed Forms
California recognizes other types of deeds that are named after features other than the warranty of title they provide. Two such deeds—life estate deeds and transfer-on-death deeds—are named for their probate avoidance features and are popular tools for estate planning.
California Life Estate Deed
A California life estate deed allows real estate to bypass probate by separating ownership into a lifetime interest (the life estate) and a future interest (the remainder) that kicks in automatically when the life-estate holder (or life tenant) dies.7 A property owner typically keeps the life estate for himself or herself and gives the remainder to a family member. An owner who records a life estate deed needs the remainder beneficiary’s consent to sell or transfer full title to the property.8
California Transfer-on-Death Deed
A property owner records a California transfer-on-death (TOD) deed during life, but the TOD deed has no legal effect until the owner dies. An owner who records a TOD deed still has the right to sell, mortgage, or transfer the property as if the TOD deed were never recorded.9 At the owner’s death, title automatically passes to a beneficiary named in the TOD deed.10
Names for deeds can relate to different features, so multiple names can sometimes apply to the same deed. For example, a California warranty deed may also be a California life estate deed if it satisfies the criteria for both names. However, California’s TOD deed law declares that a TOD deed “transfers the property without covenant or warranty of title.”11 Thus, by law, a California TOD deed cannot also be a warranty deed.
Common Uses of California Warranty Deed Forms
Warranty deeds are rarely used for modern-day California real estate transfers. Grant deeds are much more popular and are typically used for real estate sales. Warranty deeds may still be a good choice in some situations, such as:
- When a buyer purchases residential property from a seller for full value;
- When a buyer purchasing commercial real estate insists on a transfer by warranty deed;
- When a buyer does not intend to purchase title insurance or title insurance is unavailable; or
- In other circumstances where the current owner is comfortable with the legal risk associated with an unlimited warranty of title.
How to Create a California Warranty Deed Form
A warranty deed needs to make a valid real estate transfer under the terms the parties intended. It must have the right language to qualify as a warranty deed and follow California’s rules that apply to all deeds. Including the wrong language can result in a different type of deed. For example, using the word grant in the vesting paragraph could create a grant deed.12
California Warranty Deed Requirements
A California warranty deed’s granting language must be carefully worded to transfer the property with the correct warranty. Some states have statutes that define the covenants of title a warranty deed includes. In California, the covenants of title need to be described in the body of the deed itself. Failure to include the right language could result in a narrower or broader warranty than the parties agreed.
California General Deed Requirements
California warranty deeds must also meet California’s general deed requirements. California law sets formatting standards for deeds and requires deeds to include (among other things):
- An appropriate title;
- A valid legal description of the property and its assessor’s identification number;
- The recorder identification number or book-and-page number of other recorded documents that the deed references;
- The new owners’ form of co-ownership (if there are more than one transferee); and
- The transferor’s notarized signature.
A California warranty deed form must be prepared specifically for California law. Using a deed form designed for another state to transfer California real estate can result in an invalid transfer or in transfer terms that the parties did not intend.
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- See Cal. Civ. Code §§ 1113; 3304; 3305.
- McCormick v. Marcy, 132 P. 449 (Cal. 1913).
- Cal. Civ. Code § 3305.
- See Cal. Civ. Code § 1092.
- Cal. Civ. Code § 1113.
- See Cal. Civ. Code § 1057.6.
- Cal. Civ. Code § 690.
- Cal. Civ. Code § 818.
- Cal. Prob. Code § 5650.
- Cal. Prob. Code § 5614(a).
- Cal. Prob. Code § 5652(c).
- California Civil Code § 1092.