General Warranty Deed

The deed most commonly used today, and the one much preferred by title companies, is the general warranty deed. By the use of appropriate language in the deed, a covenant of warranty is created. This covenant is said to be the broadest and most effective covenant. In effect, it is a contract with reference to the title, under which the grantor or convenator agrees to pay damages if the title fails.

Express Covenants: Generally, the grantor’s warranty extends to all cases involving a failure of title to land purportedly conveyed by the deed. The covenant of warranty in a deed is an express covenant, and a Texas statute provides that no person shall be obligated to insert a covenant of warranty in any conveyance.

Implied Covenants: The seller, by the use of the word "grant" or "convey" in any conveyance of land, will give rise to two implied covenants. The first such covenant is that the grantor warrants to the grantee that he has not previously conveyed the same estate, or any right, title, or interest, to any person other than the grantee. Second, the grantor warrants that the estate conveyed is at the time of the execution of such conveyance free from encumbrances. The term "encumbrances" includes taxes, assessments, and all liens upon real property. Although these implied covenants arise by operation of law when the words "grant" or "convey" are used in the conveyance, the grantor nonetheless may negate or restrain the covenants by express terms contained in the conveyance. Thus, a grantor intending to negate any warranty in his conveyance may use language similar to the following: "Grantor herein makes no warranty as to the title to the property herein conveyed either express or implied.

Title companies favor the warranty deed because it gives them subrogation rights against the seller and allows the buyer benefits of the after-acquired title doctrine.