What is the difference between a warranty deed a quit claim deed?

Attorney Tom Olsen: What's the difference between a warranty deed and a quit-claim deed? I get that question on a pretty regular basis. People call me and say, "Tom, I need to have a deed done where I'm adding my wife's name to the property or giving my home to my child." I go," Yes, I can do that deed for you," and they go, "Should it be a quit-claim deed or a warranty deed?" I generally don't bother distinguishing between the two because either one of them are going to convey title, and either one of them are going to accomplish our goal.

Attorney Chris Merrill: Exactly. However, you're right. That is a common question. They say quit-claim, and I like you correct them and I say that we do warranty deeds. Everything we are doing for them is a warranty deed.

Attorney Tom Olsen: By the way, a lot of people pronounce it as quick, as in fast. Q-U-I-C-K but in fact-

Attorney Chris Merrill: Quit.

Attorney Tom Olsen: -it is quit, Q-U-I-T. What's the difference? Well, with a warranty deed, if you were to give a warranty deed to your home to somebody, and a year from now they discovered that there were liens against that home or you did not have good title of that home, they could sue you because when you give a warranty deed, you are giving a warranty of good title. If you do a quit-claim deed, you're not making any warranty of titles. I could do a quit-claim deed to you today for the Brooklyn Bridge, and you can give me $100,000 and think that you own the Brooklyn Bridge. A year from now when you figure out that you don't, you come back and sue me--

Attorney Chris Merrill: I'm out of luck.

Attorney Tom Olsen: Yes, you can't sue me because I didn't do any warranty to it so you--

Attorney Chris Merrill: That's right. It was a quit-claim.

Attorney Tom Olsen: Quit-claim deed, exactly. Sometimes people say, "Tom, when do you use a quit-claim deed?" What I found is situations where there's a boundary line dispute because the world is not a perfectly flat place. When the people do surveys, sometimes two properties are right next to each other. Each of them have a survey, but the surveyors started from different starting locations. That means that sometimes even with the best of intentions and everybody's best effort, property lines do sometimes slightly overlap each other. When neighbors are trying to figure that out, they would be giving each other quit-claim deeds because you're not saying I absolutely own this. I don't really know if I own it or not, but whatever I do own of this sliver piece of land between us,-

Attorney Chris Merrill: Is yours.

Attorney Tom Olsen: -I'm giving it to you.

Attorney Chris Merrill: Exactly. Yes, you're right. I think another thing too, it's interesting to me is that I've had this from time to time, where people then will say they want to do a quit-claim versus a warranty even if they don't completely understand because they think it's cheaper. They think automatically by doing quit-claim, it's going to be cheaper than a warranty. They'll say, "Wouldn't it be cheaper for me to do a quit-claim?" I say, "Well, it's my responsibility to do what's right for you."

Attorney Tom Olsen: Yes, exactly.

Attorney Chris Merrill: Anyway, it just made me think of when you were saying that because I've had that from time to time as well.

Attorney Tom Olsen: Hey, while we're on that topic, if you look at a deed, whether it's a warranty deed or a quit-claim deed as a layman, you're going to look at that deed and go, "Oh, this is so easy, I can figure this out, I can do it by myself." I know from experience that when I see a homemade deed, I know there's at least a 75% chance that there was a mistake done on it.

Attorney Chris Merrill: I think 90%.

Attorney Tom Olsen: 90%. Okay. Sometimes when people that did that deed while they're alive, they realize that a mistake was made, and since they're alive, they have an opportunity to fix that mistake. I'm fixing one right now that a gentleman did. He's alive, he's there to fix it, but if that person passes away with that mistake in the deed, boy, now we got a real problem because he or she are not around to fix it. Now we've got a real problem with us through some kind of lawsuit to try and fix that bad deed.

Attorney Chris Merrill: That's why when people come to us and we review deeds, which we do every day, and we will explain to them on these homemade deeds that it would be our recommendation to redo it now while they're alive. Some people are reluctant or they don't end up doing it and then they run into the problem when they pass away.

Attorney Tom Olsen: The deed that I'm fixing from last week was a husband who a few years ago wanted to add his wife's name to the deed. He does a homemade deed from husband to wife and records it and he thinks, "Okay, now we own it 50/50," but in fact, he gave the whole thing to her. Now we got to go fix it.

Attorney Chris Merrill: That's a perfect example.