Special Warranty Deed

In depth

A special warranty deed, also called a limited warranty deed in some states, provides a middle ground between a general warranty and a quitclaim. The grantor warrants only against title defects that arose while they held the property, not against issues from prior owners. Misconception: special warranty deeds are not low-quality deeds; they are standard in commercial transactions, REO sales, and many corporate or estate conveyances. Practically, a buyer accepting a special warranty deed must rely on title insurance to cover earlier defects in the chain of title. In owner-finance deals, sellers who acquired the property through foreclosure or as a flip often deliver a special warranty deed because they have limited knowledge of the older history. Always pair with title insurance.