What is a special warranty deed?

A special warranty deed is a type of deed in real estate transactions that provides a limited warranty. The significance of this deed lies in the fact that it guarantees only against defects that may have occurred during the time the grantor owned the property. This means that the grantor is responsible for any issues or claims that arose after their acquisition of the property but offers no assurance regarding problems or claims that occurred prior to their ownership.

This limited scope of protection is what differentiates it from other types of deeds, such as a general warranty deed, which covers all potential defects, whether they arose during the grantor's ownership or prior. Understanding this distinction is crucial for parties involved in a transaction, as it directly impacts the level of risk and the assurances provided regarding the property's title.

The other options, while related to the topic of real estate transactions, do not accurately describe the nature and function of a special warranty deed. For instance, the assumption that it assures against all past defects is characteristic of a general warranty deed, while the suggestion that it is a document transferring ownership without warranties does not capture the essence of the limited warranties involved in a special warranty deed. Lastly, describing it as a legal contract for lease agreements is unrelated to the concept of deeds,