The term "deed" refers to a legal document that is used in Pennsylvania and elsewhere to transfer ownership of real property. Deeds also serve to establish a legal interest in real property. If someone holds a deed to a property, they have an ownership interest in it.
But that doesn't mean that all deeds are alike. In fact, there are a variety of types of deeds used in Pennsylvania, including the quitclaim deed – sometimes misidentified as "quick claim deed." This kind of deed is used to convey an interest in real property that makes no guarantees about title or ownership. It simply transfers to a grantee whatever interest the grantor may have in the real property.
It's important to choose a type of deed with care since the differences in deeds involve the covenants (promises and guarantees) that the seller makes to the buyer.
What Is a Covenant?
A covenant is a promise or guarantee from the grantor of property that is written into the deed. The types and number of covenants that a deed contains define the deed. Present covenants are promises that apply at the time of the transfer; future covenants refer to the seller's promise to take care of issues that may arise in the future.
Some deeds in Pennsylvania offer many protections to the buyer in terms of the covenants they contain. Others, like a quitclaim deed, offer few covenants and little protection.
Types of Covenants in Deeds
The basic covenants offered as part of a deed in Pennsylvania are:
- Guarantee from the seller that the real property being sold is clear of any hidden mortgages and liens.
- Guarantee from the seller that they have the right to make the current sale.
- Guarantee to protect the buyer from competing ownership claims.
Property Deeds Under Pennsylvania State Law
A property deed is a legal document that evidences someone's legal interest in a piece of real estate. Think of it as the real property equivalent of a car title. Just like an individual pulls out a car title to prove that they own the vehicle, they might point to a deed to prove that they own a piece of real property.
Property deeds, like vehicle titles, are part of the public record in Pennsylvania. The deeds must be recorded (officially filed) with the register or recorder of deeds in the county where the property is located. Once a deed is recorded, all persons are on notice of the ownership interest expressed in the deed.
Order of Recording a Deed
Since Pennsylvania is a "race notice" jurisdiction, the first person to record a deed has the superior right to title. That means that if two deeds show up transferring the same property interest to two different people, the first deed to be recorded is the one that will take the interest.
A prior unrecorded deed from a prior owner will be defeated by a second deed, even if it was drawn later in time, if it was the first one recorded.
Common Deeds in Pennsylvania
The most common types of deeds used to transfer property in Pennsylvania are warranty deeds and quitclaim deeds. Warranty deeds contain promises that will protect the buyer's interest. Quitclaim deeds do not.
Warranty deeds in Pennsylvania can be either special warranty deeds or general warranty deeds. Each one offers the buyer promises to defend the title, but the general warranty offers more.
General Warranty Deeds in Pennsylvania
A Pennsylvania general warranty deed offers the best protection to a buyer since it contains the broadest promises from the seller, or grantor. As part of the legal language in the deed, the grantor promises to defend the buyer, the grantee, against any and all claims against the property.
This broad warranty requires the grantor to defend against any claim of superior rights, even if the person asserts that their rights are superior to the grantor's. This might happen if the person obtained property rights from someone who held title before the seller.
This promise to defend can be viewed as a "bridge too far" by a seller since they have no way of knowing about a prior owner’s actions.
Special Warranty Deeds in Pennsylvania
The other warranty deed is termed the special warranty deed. While the general warranty deed may be crowned the best deed, the special warranty deed wins the popularity contest. It is the most common type of deed in Pennsylvania.
In the legal language of the special warranty deed, the grantor promises to defend against claims against the property “specially,” rather than "generally."
"Specially" is a legal term meaning that the seller will defend against claims of superior ownership, but only from those claiming rights or ownership that came from that grantor directly. This limits the seller's risk since it requires only that the seller take responsibility for their own actions. If they transferred the property to someone else before or after this current transfer, they are likely to know about it.
Quitclaim Deeds in Pennsylvania
If the special warranty deed contains narrower promises than the general warranty deed, the quitclaim deed is not even on the same page. A quitclaim deed makes absolutely no promises at all. While this will not keep the seller awake at night, it might give a buyer pause.
A Pennsylvania quitclaim deed provides no protections to a buyer. While it is a valid legal document that conveys an interest in real property, that interest is neither defined nor certain because a quitclaim deed transfers whatever interest the grantor may have in the real property, but makes no promises or guarantees about:
- Whether the seller has any interest in the property.
- What that interest is.
- Encumbrances or liens on the property.
- Whether anyone else claims an interest in the title.
Seller Can Only Transfer Their Interest
If the seller turns out to have no interest at all in the real property, the buyer receives nothing of value. In addition, the deed specifically states that the seller does not make any guarantees about defending the buyer against anyone else claiming title. The deed simply states that, by executing the quitclaim, the grantor transfers any interest that they might have in the property to the grantee.
Obviously, this is not a very popular deed for Pennsylvania buyers operating in the open market. Nobody in their right mind would pay fair market value in exchange for an undefined and uncertain interest that could range from zero percent to 100 percent.
The person taking the deed gets whatever interest the grantor may have, but they might not have any. Or they might have some interest, but numerous mortgages or liens on the property make it worthless.
Quitclaim Transfers Property As Is
The second thing to recognize about Pennsylvania quitclaim deeds is that they transfer a property "as is." That means that the buyer purchases the property with any encumbrances against it at the time. It doesn't matter if they are aware of them at the time of purchase or not.
The key word that defines a quitclaim deed is "release." The seller "releases" (and quitclaims) to the buyer all the right, title, interest and claim that the seller owns in the property.
Transfer of Encumbrances
Under Pennsylvania law, once a grantor has quitclaimed and released their ownership interest, they have no further legal interest in the property. But there is no language describing any encumbrances or guaranteeing that they have been revealed to the seller.
- Property tax liens.
- Judgment liens.
- Other liens, such as mechanics' liens, that are attached to the property.
Using Quitclaim Deeds in Pennsylvania
Buyers in Pennsylvania, for obvious reasons, opt against using quitclaim deeds for traditional arm's length purchase and sales. However, there are times when quitclaim deeds are the perfect, easy solution. They are often used for real estate transfers among family members, in divorces, or between related businesses and entities.
For example, quitclaim deeds are a fast and easy way for an individual to transfer property they own personally into a living trust. Another popular use is to transfer one spouse's interest in the family home after a divorce. Quitclaims are also quick solutions for correcting errors in prior deeds or to resolve title issues.
In short, there are good reasons for using a quitclaim deed. They include transferring property ownership from:
- Community property to joint tenancy.
- Individual ownership into a revocable living trust.
- One spouse to the other after a divorce.
- One co-owner to another.
- One owner to a co-ownership situation.
Filing a Quitclaim Deed in Pennsylvania
If an individual wishes to file a quitclaim deed in Pennsylvania, the easiest way to proceed is to download or obtain a quitclaim deed form that is intended for the county in which the property is located. The person filling out the form needs to input a legal description of the property into the quitclaim. This can be found on the latest property tax bill.
In addition, the quitclaim deed must include:
- Seller's full name.
- Seller's mailing address.
- Seller's marital status.
- Buyer's full name.
- Buyer's mailing address.
- Buyer's marital status.
- How buyer will hold title, whether by sole ownership or in co-ownership.
Filing a Certificate of Residence
After the deed is filled out, the grantee must sign a Certificate of Residence listing their name and address. This Certificate of Residence should be added to the quitclaim deed. The quitclaim must be signed in front of a notary.
The grantor must pay any transfer tax that is due. The Pennsylvania state codes provide that a quitclaim deed is taxable upon the same basis as another deed if there is an actual conveyance of real estate.
Note that while Pennsylvania imposes a real estate transfer tax for most transactions, some transfers are exempt. These include many of the types of transfers that may involve quitclaim deeds, such as transfers between family members, transfers to or from a living trust, or transfers under a will.
Recording the Quitclaim Deed
The final step is to record the quitclaim deed in the recorder's office of the county in which the property is located. It is very important to do this. If the quitclaim deed isn't recorded, it is considered void if there is a future buyer who doesn't know about the quitclaim.
In some cases, the seller must file a Realty Tax Statement of Value form along with the deed. This is required for a transfer tax exemption other than for a transfer between spouses, siblings, parents and children, and grandparents and grandchildren.
The form and instructions are available from the Pennsylvania Department of Revenue website. Some Pennsylvania counties impose their own additional tax, so check before recording. Any tax amount will be based on the value of the property being transferred.
- Deeds.com: Pennsylvania Quit Claim Deed Forms
- Tlacik Law: Different Types of Deeds in Pennsylvania
- Pennsylvania Code: 91.164. Quitclaim Deeds
- Findlaw: Pennsylvania Statutes Title 21 P.S. Deeds and Mortgages Section 7.
- Findlaw: Pennsylvania Statutes Title 21 P.S. Deeds and Mortgages Section 5 Warrant Generally
- FindLaw: Pennsylvania Statutes Title 21 P.S. Deeds and Mortgages Section 6 Warrant Specially
- Investopedia: Quitclaim Deed
Teo Spengler earned a J.D. from U.C. Berkeley's Boalt Hall. As an Assistant Attorney General in Juneau, she practiced before the Alaska Supreme Court and the U.S. Supreme Court before opening a plaintiff's personal injury practice in San Francisco. She holds both an M.A. and an M.F.A in creative writing and enjoys writing legal blogs and articles. Her work has appeared in numerous online publications including USA Today, Legal Zoom, eHow Business, Livestrong, SF Gate, Go Banking Rates, Arizona Central, Houston Chronicle, Navy Federal Credit Union, Pearson, Quicken.com, TurboTax.com, and numerous attorney websites. Spengler splits her time between the French Basque Country and Northern California.