The process of buying a home involves a lot of dreaming. We think about what our perfect house will be like, from the feel of the neighborhood to the smallest detail on the stairs.
But buying a home isn’t just about finding the “right one.” To transfer ownership, you need to know how to talk in the legal language of real estate. That sounds scary, but every person who wants to own their own home should know the basics.
By breaking down the words, you’ll be on your way to getting your place. So, let’s look at what makes a grantor different from a grantee.
What is a Grantor and Grantee?
A grantor and grantee are legal terms that refer to the two parties involved in a property transfer or grant of rights. The grantor is the person or entity that is granting or transferring property rights or interests to another party. This could involve transferring ownership of real estate through a deed, granting an easement on the property, transferring intellectual property rights through a license, or granting other legal interests and rights.
The grantee is the person or entity that is receiving the grant of rights or property interests from the grantor. For example, when a homeowner sells their house, they (the grantor) grant the ownership rights of the property through a deed to the home buyer (the grantee). The key difference is that the grantor is the one giving or transferring the legal rights or interests, while the grantee is the recipient of those granted rights or interests. These terms are most commonly used in property law but can apply to any legal granting of rights, permissions, or interests from one party to another.
Difference between Grantor and Grantee/Grantor Vs Grantee
The terms grantor and grantee are often used in legal documents and real estate transactions. The people involved in a transfer of ownership of property, assets, or rights are called the buyer and the seller. It’s important to know the difference between these two terms because it can affect what the law says and who is responsible for what. This article will explain the difference between a grantor and a grantee and how each term is used in legal documents and real estate transactions.
Grantor vs Grantee Real Estate
In real estate transactions, the grantor and grantee are the parties involved in the transfer of property ownership. The grantor is the person or entity that currently holds the title to the property and is selling or transferring it. They are essentially the seller. The grantee is the person or entity that is purchasing or receiving the property through the transfer. They become the new owner and titleholder. When a property sale or transfer occurs, the deed document names the grantor as the one conveying the property and the grantee as the recipient. The grantor signs over the deed, relinquishing their ownership rights.
The grantee provides payment and takes possession, acquiring the title. The grantor’s name appears first on the deed until the transfer is completed, at which point the grantee becomes the primary name on the title. Understanding the distinction between grantor and grantee is important for keeping track of property ownership transfers.
What is a Grantor?
A grantor is a person, group, or organization that gives property or assets to another person or group. The grantor is also called the donor, seller, or transferor. The grantor is the person who starts the process of transferring ownership and is responsible for making and signing the legal papers that make the transfer possible. For the transfer of ownership to be legally binding, the grantor has certain duties and responsibilities that must be met. These duties include making sure that the property being given away is free of any liens or encumbrances and giving the grantee a clear title that can be sold.
In a real estate deal, the person who is selling the property to the buyer is called the grantor. Most of the time, the grantor will hire a real estate agent or an attorney to handle the legal aspects of the transaction. The grantor is also responsible for providing the necessary paperwork, such as a deed, to complete the transfer of ownership.
What is a Grantee?
A person, group, or business that gets property or assets from a grantor is called a grantee. People also call the grantee the buyer, the transferee, or the done. The person who gets the transfer of ownership is called the grantee, and it is their job to pay any fees that are due as part of the transfer. As the owner, the grantee has certain rights and responsibilities, like paying property taxes and taking care of the property.
In a real estate deal, the person who buys the property from the seller is called the grantee. Most of the time, the grantee will hire a real estate agent or an attorney to handle the legal parts of the deal. The grantee will also be responsible for paying the purchase price and any other fees, like closing costs.
How many different kinds of grantees?
In real estate transactions, the grantee is the person or organization that gets ownership of the property being transferred. There are many different kinds of people who get grants, such as:
- Individual Grantee
A person who is getting ownership of the property being transferred is called an individual grantee. In residential real estate deals, this is the most common type of grantee.
- Corporation Grantee
A corporation grantee is a business entity that gets ownership of the property being transferred. In commercial real estate deals, this type of grantee is often used.
- Partnership Grantee
A partnership grantee is a business group made up of two or more people who will own the property being given away. This kind of grantee is often used in joint ventures and other types of business deals.
- Trust Grantee
A trust grantee is a legal entity set up to hold and manage assets on behalf of beneficiaries. This kind of grantee is often used to plan an estate and protect assets.
- Governmental Grantee
A federal, state, or local government agency that takes ownership of the property being transferred is a governmental grantee. This kind of grantee is often used when the government takes private property for public use through eminent domain or other means.
What is the Difference between a Grantor and a Grantee?
|The person or entity who currently owns the property being transferred.||The person or entity who is receiving the property being transferred.|
|Transfers ownership of the property to the grantee.||Receives ownership of the property from the grantor.|
|Can be an individual or a legal entity such as a corporation, trust, or government agency.||Can be an individual or a legal entity such as a corporation, trust, or government agency.|
|May provide a warranty deed or other legal documents to guarantee the quality and condition of the title being transferred.||May purchase title insurance to protect against any defects or problems with the title to the property being transferred.|
|May be responsible for paying certain closing costs, such as real estate commissions and transfer taxes.||May be responsible for paying certain closing costs, such as title insurance premiums and recording fees.|
|May be liable for any defects in the title to the property being transferred if a warranty deed is provided.||Receives legal ownership of the property being transferred, subject to any liens, encumbrances, or other title issues that may exist.|
It’s important to note that these are general differences and that the specifics of a real estate transaction can vary depending on the state, the type of property being transferred, and the terms of the agreement between the grantor and grantee.
Documents that are required in real estate with grantors and grantees
In a real estate transaction, both the person giving the property away and the person getting it must fill out and sign several documents. Some of the most important papers needed are:
A deed is a legal document that says who owns a piece of property and who doesn’t. What kind of deed is used will depend on the specifics of the deal.
- Bill of Sale
A bill of sale is a document that transfers personal property, like appliances or furniture, from the grantor to the grantee.
- Title Report
A title report is a piece of paper that shows who owned the property in the past and if there are any liens or other claims on it.
- Affidavit of Title
An affidavit of title is a document signed by the grantor that says they own the property being given away and that there are no liens or other claims against it unless the deed says otherwise.
- Closing Statement
A closing statement is a document that shows the final settlement of all financial transactions related to the real estate transaction. This includes the purchase price, closing costs, and any other fees or expenses.
- Mortgage Documents
If the transaction involves a mortgage, additional documents will be needed, such as a mortgage note, a mortgage deed of trust, and a Truth in Lending Disclosure.
What is the best deed for a grantee?
The best deed for a grantee depends on the details of the real estate deal and the preferences of the people involved. Warranty deeds, special warranty deeds, and quitclaim deeds are the most common types of deeds used in real estate transactions. Each type of deed gives the grantee a different level of protection, as shown below:
- Warranty Deed
A warranty deed is a kind of deed that gives the grantee the most protection. It makes sure that the person giving away the property has a clear title to it and that there are no liens or other claims against it. If there are problems with the title, the person who got it can file a claim against the person who gave it to them. This kind of deed is often used when the person getting the property pays the full market value for it.
- Special Warranty Deed
A special warranty deed is a kind of deed that protects the grantee less than a warranty deed. It guarantees that the grantor had clear title to the property while they owned it and that there are no outstanding liens or encumbrances on the property, but only while the grantor owned the property. This kind of deed is often used when the person getting the property is paying less than the property’s market value.
- Quitclaim Deed
This is the type of deed that gives the grantee the least amount of protection. It gives the grantee the grantor’s interest in the property, but it doesn’t say anything about the title or any liens or other claims on the property. This kind of deed is often used when family members buy or sell the property or when someone gives someone else property as a gift.
What is a warranty deed in Texas?
In Texas, a warranty deed is a type of legal document used in real estate transactions. It is a promise, or warranty, from the seller, or grantor, to the buyer, or grantee, that the title to the property being transferred is clear and free of any problems or liens unless the deed says otherwise.
In a Texas warranty deed, the grantor gives the grantee several promises, such as:
- That they own the property legally and have the right to give the title to the grantee.
- That the title to the property has no liens, mortgages, or other claims against it unless the deed says otherwise.
- That they will defend the title if someone else claims it. Theyy will give you any paperwork or help you need to fix any problems or flaws with the title.
In Texas, the grantor must sign a warranty deed in front of a notary public and two witnesses. The deed must then be filed with the county clerk in the county where the property is. Both the grantor and the grantee should talk to a real estate lawyer to make sure all legal requirements are met and the deal is properly recorded.
What is the strongest form of the deed?
A general warranty deed, also called a warranty deed with full covenants, is the strongest type of deed. This type of deed gives the grantee the most protection because it comes with specific warranties and guarantees from the grantor about the quality and condition of the property’s title.
Most of the time, a grantor makes the following promises or covenants in a general warranty deed:
Covenant of seisin: The person giving away the property says they own it and have the right to give it to the person getting it.
Covenant of quiet enjoyment: The grantor promises that the grantee will be able to use and enjoy the property without being bothered and that the grantor will defend the title against any claims made by third parties.
Covenant of further assurances: The grantor promises to do whatever else is needed to make sure the property’s title is free and clear of any flaws or encumbrances.
Covenant against encumbrances: The grantor promises that the property being given away has no liens or other encumbrances unless the deed says otherwise.
Covenant of warranty: The grantor promises to defend the property’s title against any claims made by third parties and to pay the grantee for any losses they might suffer because of flaws in the title.
In a transfer of title, grantors, and grantees are on opposite titles. Grantors are the sellers or lessees, and grantees are the buyers or lessees. Most deeds protect both parties in some way, whether it’s about who owns and is responsible for the property or about claims and liens against it.
The legal rights and responsibilities of both parties can be affected by the type of deed used in the transfer, such as a warranty deed. Also, title insurance can be an important way to protect the grantee from any problems with the property’s title. Overall, both the person giving the money and the person receiving it can benefit from working with a qualified estate agent and a lawyer.
Faizan Ahmad is a financial analyst and writer who specializes in investments, banking, and corporate finance. He has over 7 years of experience working in the finance industry in various roles.
He leverages his strong financial modeling and data analysis skills to provide insightful commentary on business, markets, and economic trends.
At Ventures Money, Faizan covers topics including Credit Card Reviews, Loans, Insurance, and Mutual Funds in the banking sector. He provides in-depth analysis of the latest news and trends to help readers make smart investment decisions.
Outside of writing, Faizan enjoys following the stock market, rooting for his favorite sports teams, and spending time with his family.