6 Essential Elements Of A Deed For Transfer Of Title

A deed in it’s most basic form is a written legal document that conveys ownership of a property from one party to another.

And for a deed to be watertight, it has to contain 6 elements.

Before we go on, it is important to make a distinction between title and deed. Because people in the industry often use the term “title deed” representing a deed, it is essential to recognize that from from a legal standpoint, a title does not have the same meaning as a deed.

A title is basically a legal way of saying you own the right to use a property. This can refer to an absolute interest or a partial interest in the real estate in question. With the title, you can transfer the interest you own to others. An important point to note is that one can never transfer more interest than he owns.

A deed refers to the written legal documents explicitly stating the title transfer from one party to another.

Now that we have got that out of the way, let’s move on the elements of a binding deed. A deed without the following elements can result in an imperfect deed. The implications of that… it’s better you check with your local real estate attorney.

1) Identity

A deed document must clearly identify the party giving up ownership (grantor) and the party acquiring that ownership (grantee).

A grant is the term used to specify the act of conveying ownership.

To be enforceable by law, a grantor must have reached the legal age in the state (usually 18).

2) Consideration

There must be the presence of consideration.

This is not the word associated with considering what to eat for dinner and considering what time to go to sleep.

In the legal world, consideration is an item of value promised to another when making a contract.

The most commonly used form of consideration is money. But do note that consideration is not limited to money.

3) Words of conveyance

The deed must contain, in written form, words of conveyance that the grantor:

1. distinctly states a grant of real property to the grantee is being made
2. expressly identifies the quality of the estate that is being granted

A lack of clarity in this area can make the deed prone to challenges in future.

4) Land description

It goes without saying that the property being conveyed must be clearly stated. This can be easier said that done.

Apartments in a city might be easy to distinguish. But problems and confusions can arise in less urban areas where boundaries and land markings are unclear.

The land description on a deed must be ever so clear and as good as impossible to misunderstand or misinterpret.

This is when acceptable legal methods of land description must be used. For example:

• meets and bounds
• government survey system
• recorded plat
• etc

Also take note that street names are often avoided because they do not clearly state the boundaries of land. Further more streets are often closed down, revamped, or have their names changed.

5) Signature

The grantor will have to sign on a deed in order to execute it.

In some areas, the presence of a witness is required by law. And that witness will also have to endorse it by signing on the document.

In the event that the grantor is a corporation, the corporation’s authorized representative will be the signatory accompanied by the official corporate seal.

However, these days different states are adopting differing process for electronic signatures and marks. So do check with the local authorities to learn more.

6) Delivery and acceptance

As the final step, a proper transfer is not concluded from a finalized deed until it is delivered by the grantor to the grantee, and accepted by the grantee.

When delivery is made and there is acceptance, the title passes and the deed serves as evidence.

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