What Does Convey Mean in Real Estate? What It Means and Why It Matters

If you are buying or selling a property, you may come across the term “convey” or “conveyance” in the process.

An image of a a house being sold
Image of house on sell [PHOTO COURTESY OF REAL HOMES]
But what does it mean and why is it important?

In this article, we will explain the meaning and significance of conveyance in real estate transactions.

Definition of Conveyance

Conveyance is the act of transferring property from one party to another.

The term is commonly used in real estate transactions when buyers and sellers transfer ownership of land, building, or home.

This is done using an instrument of conveyance—a legal document such as a contract, lease, title, or deed.

The document stipulates the agreed-upon purchase price and date of actual transfer, as well as the obligations and responsibilities of both parties.

Types of Conveyance Instruments

There are different types of conveyance instruments that can be used to transfer property, depending on the nature and purpose of the transaction.

Some of the most common ones are:

1.Deed

A deed is a written document that transfers the legal title of a property from the seller to the buyer.

It must be signed by the seller, witnessed by a notary public, and recorded in the public records of the county where the property is located.

There are different types of deeds, such as warranty deed, quitclaim deed, and special warranty deed, that offer different levels of protection and guarantees to the buyer.

2.Lease

A lease is a written document that transfers the right to use and occupy a property from the owner to the tenant for a specified period of time and under certain conditions.

It does not transfer the ownership of the property, but only grants a temporary and revocable interest to the tenant.

A lease must include the names of the parties, the description of the property, the rent amount and payment terms, the duration and termination of the lease, and the rights and obligations of both parties.

3.Contract

A contract is a written document that outlines the terms and conditions of a real estate transaction between the buyer and the seller.

It is usually signed by both parties before the actual transfer of the property takes place.

A contract must include the names of the parties, the description of the property, the purchase price and payment method, the closing date and costs, the contingencies and disclosures, and the signatures of both parties.

Importance of Conveyance

Conveyance is an essential part of any real estate transaction, as it ensures that the buyer is informed in advance of any restrictions on the property, such as mortgages and liens, and assures the buyer of a clean title to the property.

Conveyance also protects the seller from any future claims or liabilities arising from the property after the sale.

It also involves the payment of taxes and fees associated with the transfer of the property, such as conveyance tax, recording fee, title insurance, and escrow fee.

What is the difference between a deed and a lease?

The main difference between a deed and a lease is that a deed transfers the ownership of a property, while a lease transfers the right to use and occupy a property.

A deed is a permanent and irrevocable transfer of title, while a lease is a temporary and revocable transfer of interest.

It requires the seller to sign and record the document, while a lease requires the owner and the tenant to sign and abide by the document.

A deed may offer different levels of guarantees to the buyer, while a lease may include different terms and conditions for the tenant.

You can read more about the types of deeds and leases in the article I wrote for you.

Conclusion

It is the act of transferring property from one party to another using a legal document such as a deed, lease, or contract.

Conveyance is a vital step in any real estate transaction, as it determines the rights and responsibilities of both the buyer and the seller, and ensures the validity and legality of the transfer.

It also involves the payment of taxes and fees related to the transfer of the property.

Therefore, it is important to understand the meaning and significance of conveyance in real estate, and to consult a professional such as a real estate agent, a lawyer, or a title company to assist you with the process.

Leave a Comment