Maryland Special Warranty Deed Form
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What Is a Maryland Special Warranty Deed Form?
A Maryland special warranty deed form is a legal document used to transfer Maryland real estate with a limited warranty of title. A special warranty deed guarantees that the seller (grantor) has done nothing to impair the property’s title while he or she owned the property.1 A grantor who signs a special warranty deed promises to defend the new owner’s title against third-party claims based on something that occurred during the grantor’s ownership period. The grantor makes no promises about anything that did or did not occur while previous owners held title.
Maryland law provides special language that, when included in a deed, makes the deed a special warranty deed.2
What Is Warranty of Title?
A warranty of title in Maryland refers to the assurances and guarantees provided by a grantor to a grantee regarding the status of the property’s title. A complete warranty of title guarantees that there are no problems with the property’s title arising at any time during the property’s ownership history. A Maryland special warranty deed provides a limited warranty of title that covers any potential title issues that may have arose while the grantor owned the property.
Other Names for a Maryland Special Warranty Deed Form
While the term special warranty deed is common in many states, including Maryland, some states may use different names for the same type of deed with limited warranties. A special warranty deed may also be called a limited warranty deed, a covenant deed, or a grant deed.
The key characteristic of this type of deed is that the grantor warrants only against defects and encumbrances that occurred during his or her period of ownership, offering a more limited level of protection to the grantee compared to a general warranty deed.
How Do Maryland Special Warranty Deed Forms Relate to Other Forms of Deeds?
In Maryland, there are various types of deeds used for transferring real estate, each offering different levels of protection to the grantee. The main types of deeds used in Maryland, apart from the special warranty deed, are the general warranty deed, and the quitclaim deed.
- Maryland general warranty deed. A Maryland general warranty deed (also called simply warranty deed) provides the highest level of protection to the grantee, as it guarantees that the property title is free from any defects or encumbrances, regardless of when they originated.3 The grantor is responsible for defending the title against any lawful claims that may arise, even if they predate the grantor’s ownership.
- Maryland quitclaim deed. A Maryland quitclaim deed offers the least amount of protection to the grantee. The grantor makes no warranties or guarantees about the title and merely transfers whatever interest they may have in the property.4 The grantee assumes all risks associated with potential defects, liens, or encumbrances on the title.
The relationship between a Maryland special warranty deed and other types of Maryland deeds is mainly based on the level of protection and guarantees provided by the grantor to the grantee. A general warranty deed offers the most comprehensive protection, followed by a special warranty deed, while a quitclaim deed provides the least protection. Viewed differently, a general warranty deed places the most risk on the grantor, followed by a special warranty deed, and a quitclaim deed places no risk on the grantor.
Maryland Title Insurance and Special Warranty Deeds
Title insurance is an indemnity insurance policy designed to protect property owners and mortgage lenders from financial losses resulting from defects, liens, or encumbrances on a property’s title. When purchasing a property with a Maryland special warranty deed, title insurance can offer an additional layer of protection for the grantee beyond the limited warranties included in the deed itself.
Maryland Special Warranty Deed Forms and Other Maryland Deeds Used in Estate Planning
Estate planning involves the transfer of assets, including real estate, to designated beneficiaries upon the owner’s death, usually with the goal of avoiding probate. In Maryland, the main type of deed used for estate planning is a life estate deed. A life estate deed allows a property owner to retain a lifetime ownership interest in the real estate. The owner also transfers the right to future ownership to a designated beneficiary (the remainderman), who takes title when the owner dies.5 A life estate deed keeps the right to use and occupy the property with the owner for life and transfers the automatically without probate at the owner’s death.
Maryland Transfer-on-Death Deeds
In states that recognize them, a transfer-on-death (TOD) deed is a revocable deed that allows the property owner to designate one or more beneficiaries who will receive the property upon the owner’s death, without going through probate. The owner retains full control over the property during their lifetime and can change or revoke the beneficiaries at any time. Maryland does not recognize transfer-on-death deeds.
Common Uses of Maryland Special Warranty Deed Forms
Maryland special warranty deeds are commonly used for a variety of real estate transactions. Special warranty deeds are often used in association with title insurance for standard sales for fair market value. A special warranty deed is also common when the grantor cannot, or does not want to, provide a full warranty of title. In commercial sales, for example, a special warranty deed can be a good compromise between a quitclaim deed (which places all risk on the buyer) and a warranty deed (which places all risk on the seller).
Fiduciaries like executors and trustees prefer special warranty deeds because fiduciaries ordinarily have limited knowledge about the property’s history before the estate or trust took title. Special warranty deeds can also be useful for transactions in which real estate is re-titled without affecting actual possession and control of the property—such as a transfer to a living trust.
How to Create a Maryland Special Warranty Deed
As with any deed, a Maryland special warranty deed should be customized to reflect the specific terms and conditions of the transaction. Reliance on fill-in-the-blank forms can lead to invalid documents and future title issues.
A Maryland special warranty deed must meet all Maryland deed requirements. The deed must be formatted correctly and include all necessary information—such as the grantor’s and grantee’s names and addresses, the legal description of the property, and any exceptions or reservations to the transfer. Maryland deeds must also include a recitation of consideration, which is the amount paid by the grantee for the property.
A special warranty deed must have the language needed to create a special warranty that limits the grantor’s liability to his or her ownership period. Under Maryland law, a deed that says the grantor “will warranty specially the property hereby granted” and that the grantor “has done no act to encumber the land” is a special warranty deed.6
The grantor must sign the special warranty deed in the presence of a notary public. The notary public will verify the identity of the grantor, witness the signature, and affix a notarial seal to the deed. After the deed has been executed and notarized, it should be recorded with the clerk of the circuit court’s office in the county where the property is located. Recording the deed provides constructive notice of the transaction and helps protect the grantee’s interests in the property.
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