A warranty deed ensures that the title conveyed over property is full and free from encumbrances. It establishes trust between a buyer and a seller because the seller covenants that he will protect the buyer against any claim on the property. In short, a warranty deed makes a seller accountable to the buyer.
Usually mortgage lenders require a warranty deed before they finance any transaction based on a property. Through a warranty deed, a seller assures the buyer that the transaction is legal, proper and the title uncontested. Before a warranty deed is issued, a professional title company conducts a research on the title of the property and also delves into the history of the property to make sure that there are no legal hassles. A property is a very important investment as far as a buyer is concerned especially because it can be used as collateral for securing finance. When a warranty deed is in place, a buyer need not worry about seller’s unpaid creditors staking claim on it. It ensures that title to property is full and final.