Limited Warranty Deed, No Disclosures. - Risks?

Question

I'm looking at a property in Atlanta.  The MLS Private Notes contain the following: "Seller to provide Limited Warranty Deed. No Disclosures".  What risks should I be thinking about?  Would this be considered clean title, or if not, what would I have to do to clean up the title?  Thanks!

Kevin Polite · Answer

@Jim Young they changed this on GAR forms in 2019. This new rule is stating that the seller is not warranted the title in case something comes up. That's why you buy title insurance. always. Most Georgia agents were unaware of this. As long as your client purchases title insurance your okay.

Kevin Sobilo · Answer

@Jim Young, don't pay any attention to @Mark Durham. He obviously missed the point of the post. Maybe he was too busy googling something.

Understanding the meaning of something and understanding the impact or risks is something else entirely.

So, it looks like a limited warranty deed is what in other states might be called a special warranty deed. The seller is transferring their ownership rights but only guaranteeing things that occurred during their ownership with regard to the title.

In my state, this is the most common way to transfer ownership. So, it isn't unusual at all. If you are planning to search and insure the title, I would not be at all concerned. If you planned to skip title insurance, I would look at how and when the seller took ownership.

For example, if the seller has only owned the property a very short time and acquired it through a messy process such as a tax sale then I might be concerned that there are issues that should be searched out, and taken care of.

The "no disclosure" part may or may not be appropriate. In my state sellers are required to disclosure material defects except in special cases such as estates where there is nobody with first hand knowledge.

Mark Durham · Answer

Jim, I don't want to sound unkind, but as an agent, you really should know this. Google Limited Warranty Deed.

All the best.