What a Grantee Is in Real Estate

A grantee is a legal term used in real estate that describes the person buying a property. You can also be a grantee without receiving a property deed. For instance, a land contract features both a grantor and a grantee. The grantor is the owner, and the grantee is the buyer who is acquiring an equitable interest (but not bare legal interest) in a property.

It's essential that a deed clearly states the grantee, grantor, and a description of the property involved. Any obscure language leaves both parties at risk for questioning and potential legal hurdles.

Five Types of Deeds Naming Grantor and Grantee

The five most common types of property deeds are warranty deeds, grant deeds, quitclaim deeds, interspousal transfer deeds, and grant deeds in lieu of foreclosure.

1. Warranty Deed

With a warranty deed, the grantee receives a warranty from the seller to forever defend the title against claims of all people. It ensures that the seller has the full right to sell the property. It also ensures there are no liens that exist on the title that could prevent them from selling it. Above all else, it's about protecting the grantee.

2. Grant Deed

With a grant deed, the grantee receives guarantees that the grantor has not sold the property to another party. They also are guaranteed that they have disclosed all liens and restrictions on the title that they know about.

3. Quitclaim Deed

The grantee receives whatever interest the grantor may or may not possess. The grantor of a quitclaim deed doesn't guarantee that they have a legal right to transfer the property; it's a small chance they might not even legally own it. Because of the uncertainty, this type of deed is generally not used between parties who don't know each other well. It's more often used among family members, and it offers the least amount of legal protection.

4. Interspousal Transfer Deed

With this type of deed, the grantee receives the interest of a spouse, including a forever interest in community property, and pays no transfer tax. The title is transferred between married couples, except in cases where it was a gift from one spouse to the other. This is considered separate and not mutually-owned property. These deeds are most often used when couples transfer the title to the spouse with much better credit; they may do this to get better interest rates while refinancing.

5. Grant Deed in Lieu of Foreclosure

In this situation, the grantee is often the bank the borrower owes a loan to. The property owner gives up the deed to the grantee. This is one in order to be relieved from their mortgage debt and avoid the foreclosure process. It's often the last step when a property owner has used all their other options. They may have come to terms with the fact that they will lose their home. Many people are embarrassed about foreclosure; this is a less visible route to take that can minimize any shame.

Chain of Title Searches

County courthouses and recorder offices generally contain big books filled with only grantees, known as grantee books. Title searchers used grantee books to find and document a chain of title, and many are more than 100 years old. Information is entered in grantee books in alphabetical order, with entries listed by the last name first. Next to the grantee name is the legal description, property address of the land, and the improvements being conveyed, including the date of transfer. The book and page of the deed used to transfer title are noted in the grantee book.

If you know the name of the property owner now, but you do not know the names of previous property owners, or whether the title transfers were completed appropriately, you can use the grantee book to find out when the present owner of the property acquired the title and from who. All you would need to do is work backward in the public record of the grantee book. When you find the deed of the grantor deeding to the grantee, you can then look for the grantor's name in the grantee book until you find when that individual acquired title.