One of my sellers whose closing is fast approaching called me in a panic last week because she couldn’t find the deed to her house, which she thought she’d need to bring to closing.
I explained to her that a deed is not the same thing as a title, and that all she needs to bring to closing is her driver’s license or similar ID to prove who she is.
In fact, there is no “title” to her house. A deed is a legal document which transfers property. It is not proof of ownership. When a deed is recorded by the county clerk, it results in the county changing its records to reflect the new owner’s name, and the deed, once recorded in the clerk & recorder’s database, is then mailed back to the new owner. At that point, it doesn’t matter if you lose or misplace your deed, because the county has the proof of your ownership.
This is different from how motor vehicles are transferred, where you have a title to your car and must sign it over to the new owner when you sell your car. If you lose your title, there’s a procedure for replacing it, but you need that physical title to sell your car. Not so with real estate.
Many people share my seller’s misunderstanding about deeds And there are different kinds of deeds. The deed used most often is a “warranty deed,” meaning that the seller warrants that they are the owner of the property and, with that deed, transfer it to the buyer.
There are “general” and “special” warranty deeds. I won’t go into the difference here, since the purpose of title insurance is to provide the buyer with a guarantee (regardless of the type of deed) that they are receiving the property free and clear of any claims of ownership or indebtedness by anyone other than the seller.
When a property being sold is in the estate of a deceased seller, it is sold by the “personal representative” of the estate (called an “executor” in other states), and the property is transferred via a “personal representative’s deed.” If the property is purchased at a foreclosure auction conducted by the Public Trustee (who enforces the “deed of trust” securing the mortgage for the lender), then the transfer is via a “trustee’s deed.”
Whichever kind of deed is used, the fact remains that the deed only exists as evidence of the sale, and it does not need to be presented ever again.
I am not a lawyer, and I am providing this information as I understand it from real estate classes and from my experience as a real estate professional. You’ll want to engage a lawyer if you require further explanation, and I, like any real estate licensee, can refer you to one or more real estate lawyers.
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