The most popular instrument by which property is transferred in California is the grant deed. A grant deed is very much like a bill of sale. The seller, called a “grantor,” transfers the property to the buyer, or “grantee.” Fortunately, California only has a few requirements to make a grant deed effective, but those requirements should be followed carefully. When in doubt, contact an attorney licensed to practice in California.
Grantor and Grantee’s Names
Both the grantor’s and the grantee’s names must be included in the grant deed. A court must be able to determine who the seller and who the buyer is. Common language is usually “John Doe, grantor, hereby grants to Jane Smith, grantee …”
The grant deed must contain a reasonable description of the property in case a dispute arises as to which property was conveyed. For example, if a conveyance reads “my one acre lot in Riverside County” and the grantor owns two lots in Riverside County, a court will be required to interpret the description if a dispute arises. Property is most commonly described by the property’s street address. If a portion of land is being sold and if that portion has no street address, the legal description of that portion of the property should be used. The legal description can be found on a tract map. If no tract map exists, it may be necessary to hire a professional surveyor.
The grant deed must state the purchase price, if any. If the property is being conveyed as a gift or for some other non-monetary reason, the grand deed should state “no consideration.” However, a non-monetary transfer is commonly indicated by “for valuable consideration” even though no consideration was given for the property.
The grantor must sign the grant deed in the presence of a notary. This requirement is designed to prevent a fraudulent transfer. Because the grantor is unlikely to attempt to fraudulently transfer property to a grantee, there is no requirement that the grantee sign the grant deed.
California does not require that a grant deed be recorded to be effective. However, virtually all grant deeds are in fact recorded. Recording offers the grantee protection from any later transfer of the same property. For example, assume that Seller conveys the property to A, who does not record the deed. Seller later conveys the same property to B, who does record. Assuming that B was not aware of the prior conveyance to A, B will most likely take ownership of the property in a dispute between A and B. A’s only remedy would to then sue Seller. If A had recorded the grant deed, A would have most likely taken ownership over B.