Title Insurance Basics

Types of Deeds used in Ohio

General Warranty Deed: Most common form of deed in Ohio. If there is just one buyer, title will upon death pass to such owner's heirs unless otherwise provided for by the owner's will. If there is more than one buyer then a tenancy-in-common among owners is created, which means that each buyer owns an 'undivided' interest in the property. Upon the death of one of the owners, title to their 'undivided' part interest will pass to that owner's heirs unless otherwise provided for by the owners will. The seller warrants the title to be free and clear except as stated in the deed. The seller takes on the responsibility for soundness of entire chain of title. Although the seller's warranties are desirable, Title Insurance has reduced their importance. Buyers and lenders generally rely on Title Insurance to protect the investment. Therefore, Title Insurance is also a benefit to the seller as it may reduce actual exposure if old title defects arise. 

Joint and Survivorship Deed: Warranty Deed where Joint Tenancy is created with the Right of Survivorship. Used when two or more persons are buyers. Upon the death of one of the owners, interest is not considered an asset of the estate but title to the interest transfers by contact to the survivor(s). Such interest, however, must be considered in the decedents estate for Ohio Estate Tax purposes (and for federal tax purposes) as if it was an asset of the estate. The seller also warrants title to be free and clear except as otherwise stated in the deed.

Limited Warranty Deed: The seller only warrants title as to the period that he/she held the title. They are not responsible for matters previous to the seller's acquisition. This is often used on commercial transactions where the seller and buyer agree to rely on the Title Insurance for protection but require the seller to account, if necessary, for matters occurring during the seller's ownership.

Quit-claim Deed: Simplest form of deed as it only conveys whatever interest the seller owns or may own; no warranties are expressed or implied. It creates tenancy-in-common if more than one buyer is involved. The buyer has no recourse against the seller for defects in the title. Title insurance is advisable whenever the buyer accepts title by Quit Claim Deed. 

Special Purpose Deeds: Other types of deeds are necessary under particular situations, but since their applications are limited no description need be given here. Such special purpose deeds include Sheriffs Deed (foreclosure), Executor and Administrators Deed and Guardians Deed (Probate Court), Trustees Deed (Bankruptcy) and Auditors Deed (tax sales). For further explanation or advice as to the use or preparation of any deed, it is suggested that you consult an attorney.

Transfer on Death Deed: The newest form of deed as it conveys to a beneficiary upon death of the Owner. Upon an owner's death, real property is normally considered to be an asset of the estate and therefore the property must go through Probate Court proceedings before it can be transferred. Prior to the new Transfer on Death Deed, the only alternatives to Probate were either owning property as joint tenants with rights of survivorship or placing property into a trust prior to death. The Transfer on Death Deed is a blended concept of the transfer-on-death ownership of bank account and survivorship ownership of real estate. The beneficiary does not have any vested interest in the real estate until the Grantee's death.

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