One of the most important concepts in property ownership is the relationship between grantors and grantees. Simply put, grantors give something while grantees receive something. It is essential to understand how property ownership and debts change hands during any decision-making process concerning legal judgments, title transfers, and ownership transfers of property.
While real estate property deeds typically outline the grantor and grantee very clearly, other documents, such as real estate leases, wills, business partnerships, vehicle sale and title documents, and financing contracts also identify grantors and grantees for maximum clarity. The definition of grantor and grantee vary based on the document in question.
Bear in mind that some counties have different rules for what defines grantors and grantees, so be sure to conduct thorough research at the local and state levels for your situation. Additionally, grantor-grantee indexes can be extremely lengthy and complex, but it’s vital to assess these indexes fully to ensure clear title.
Grantor/Grantee Index Basics
Grantors and grantees are known by various names depending on the instrument:
Abstract of judgment
- Grantor: judgment creditor
- Grantee: judgment debtor
- Grantor: plaintiff
- Grantee: defendant
NOTE: In certain counties, these roles may differ.
IMPORTANT: In certain counties, there are exceptions to this rule and so it is advisable to search both Grantors and Grantees and read the documents to confirm.
- Grantor: transferor
- Grantee: transferee (receiver)
Types of Grantor/Grantee Relationships
Regardless of the exact definitions for a particular case, grantors convey property to grantees. When a deed is drafted, either party may insist on various restrictions, modifications, covenants, or other clauses to strictly define how the property rights may be further reclaimed, transferred, or otherwise used. Depending on the situation, either the grantor or the grantee may have a position of strength.
Depending on the type of document in question, the title of grantor or grantee may mean very different things. For example, when dealing with court orders, a plaintiff is a grantor while a defendant is a grantee. When dealing with abstracts of judgment, the judgment creditor would be the grantor and the judgment debtor would be the grantee. There are also specific definitions when it comes to certain types of deeds:
A quitclaim deed does not include any warranties of validity concerning the grantor’s title claim. The grantee receives the exact same interest the grantor had. In quitclaim deeds, the property may still be subject to other title claims or ownership interests. Most quitclaim deeds arise in circumstance where there is a known or suspected title defect, or if there is any uncertainty about other entities’ interests in the property, divorce proceedings, heirs, or adverse possession.
Quitclaim deeds are used rarely in situations where the grantor and grantee are not personally acquainted. They afford the least amount of legal protection, so most quitclaim deeds arise from family issues or between people who know each other very well and trust one another. Transactions between parties who do not know each other usually entail very thorough definitions of every part of the agreements to mitigate the parties’ risks.
In a grant deed, the grantor has no obligation to defend title defects or any other claims, including those made during the grantor’s time of ownership. Grant deeds generally hold that the grantor has not previously sold the property in question, and the grantor is transferring ownership of the property to a grantee without any liens or encumbrances, aside from those disclosed in the deed.
General Warranty Deeds
A general warranty deed guarantees the grantor “good and marketable title” to a piece of property and the right to sell that property without any restrictions. A general warranty deed will include the entire line of ownership for the property, not just the time it was under the grantor’s ownership. This affords the grantee protection from any potential title issues.
Special Warranty Deeds
Special warranty deeds allow grantors to limit the title warranty to anyone claiming under, from, by, or through the grantor, but no one prior to the grantor. Any defects that may have existed before the grantor’s time of ownership of the property do not apply to the grantor, and the grantor has no responsibility to address them. Essentially, this means the grantee has far less protection from any unforeseen title issues.
It’s essential that any deed fully and clearly identify the grantor and grantee in any type of property ownership or title transfer. Deeds that do not clearly identify the grantor and grantee could lead to lawsuits down the road. If there is any vague language or unclear identities listed in a deed, it’s probably a good idea to redraw the deed and clarify any issues before proceeding.
Deeds are not set in stone. A grantor or grantee may pose alterations to the deed, and as long as both parties agree to the changes, the deed can evolve over time. This allows the parties involved to arrange the way property will change hands in case of events such as divorce, marriage, death, or any other event that could alter the terms of the agreement.
If there is any uncertainty about the clarity of a title, a title insurance policy can help bridge the gap and provide peace of mind. Additionally, you should have an attorney help with the drafting of the agreement to ensure there is no murky verbiage or unclear identities. Grantor/grantee relationships are fairly straightforward, but it’s important to recognize how this relationship differs for various types of documents.