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Nadine Cius

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Why Won't Title Companies Insure Quit Claim Deeds in Texas?

May 31st, 2011


Why won't title companies insure Quit Claim Deeds in Texas?  Most title companies in Texas will not insure Quit Claim Deeds because they consider them to be extremely high risk.  Title companies don't like them because unlike a General or Special Warranty Deed, they don't warrant to defend the rights of the person holding the Deed.  A Quit Claim Deed conveys  whatever interest the grantor has in the property.  Basically the grantor is saying that he cannot guaranty what rights, if any he has in the property; but whatever it is, he is granting it to you.  If it turns out at some future date that the grantor had no interest in the property or had unrecorded liens and/or encumbrances against the property, then it's your loss.  

Nevertheless, I have seen some title companies insure Quit Claim Deeds in Texas in certain cases of bank foreclosures, where the bank for one reason or another could not give a Special Warranty Deed.  Normally, it's because there are some deficiencies in the foreclosure process or paperwork.

Regardless of who is selling the property, you should not accept a Quit Claim Deed unless a title company agrees to insure it or you have consulted with a real estate attorney.  If the title company will not insure it and you accept it, then you are the one assuming all the risk in regards to the title.  




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Disclaimer : The views and opinions expressed in this blog are those of the author and do not necessarily reflect the official policy or position of the Houston Association of REALTORS®

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