A deed is an instrument that transfers a real property ownership interest from a grantor (the current owner) to a grantee (the new owner). Depending on the type of transaction, you may use different New Mexico deed forms.
A New Mexico warranty deed transfers an ownership interest in real property from a grantor to a grantee. In addition to transferring the property under a warranty deed, the grantor guarantees that their title is clear, unencumbered (except as disclosed), and free of defects.
In the future, if the grantee learns that they did not receive a defect-free title from the grantor, they can hold the grantor responsible for repairing any defects. For example, if a prior lienholder tries to encumber or foreclose on the property, the grantor is liable for the costs of defending against it.
A quitclaim deed transfers a grantor’s entire ownership interest to the grantee. However, unlike a warranty deed, a New Mexico quitclaim deed does not make any guarantees about the title. If the grantor owns a defective, encumbered ownership interest in the property, that’s what the grantee gets.
This is rarely used in property sales because it offers no title protection to the buyer. The most common uses for a quitclaim deed are transfers between family members, former spouses as part of a divorce, and gifts.
A specialty warranty deed offers more protection to the grantee than a quitclaim deed. However, its protections are more limited than those of a general warranty deed. A New Mexico special warranty deed guarantees that the grantor has done nothing to encumber the property or create defects in the chain of title during their ownership.
However, a special warranty deed makes no guarantees for previous owners, which means older defects and encumbrances may eventually appear. If that happens, it’s the grantee’s responsibility to repair them.
A deed of trust is an instrument used to secure a loan between a lender (the “trustee”) and borrower. In New Mexico, a borrower grants a deed of trust to the lender as security for a loan. If the borrower defaults on the loan, the lender may sell the property as a trustee to collect on it without a court order.
In some other states, lenders may use a mortgage in place of a deed of trust. A mortgage also secures a loan between a borrower and a lender but requires court intervention before the lender can sell the property.
Here are some common questions about New Mexico property deeds.