Arkansas Special Warranty Deed Form

What Is an Arkansas Special Warranty Deed Form?

An Arkansas special warranty deed is a legal document that transfers ownership of Arkansas real estate with a limited warranty. The seller who signs a special warranty deed warrants that he or she has done nothing to impair the property’s title.¹ A special warranty deed protects a buyer against any title problems that may have arisen during the seller’s ownership of the property. A special warranty deed does not protect the new owner from title problems that existed before the seller acquired the property.

What Is Warranty of Title?

In Arkansas, a warranty of title is a legal guarantee—which a seller (or grantor) of real estate provides to the buyer (or grantee)—that the seller has clear and marketable title to the property. A warranty of title guarantees that there are no problems with a property’s title that would make the property less valuable or harder to sell. A buyer who discovers a title problem—such as an undisclosed lien—can recover from the seller the financial damage that the problem causes.²

Arkansas law considers a warranty of title a legally binding promise that runs with the land. This means the warranty is not just a promise between the buyer and seller. It also binds any subsequent owners of the property. In other words, if the buyer later sells the property to another person, the warranty of title in the original deed is still in effect.

An Arkansas special warranty deed transfers property with a partial warranty—often called a limited warranty or special warranty. The seller guarantees a good, clear title to the property, but the guarantee only covers issues that arose while the seller owned the property. The special warranty does not cover title problems from before the seller acquired the property. A deed with a warranty that covers title problems at any point in the property’s history is called a general warranty deed.

Other Names for an Arkansas Special Warranty Deed Form

Like most states, Arkansas refers to a deed that provides a limited warranty of title as a special warranty deed. Other states use the term limited warranty deed. In California, the same document is called a grant deed.

How Do Arkansas Special Warranty Deed Forms Relate to Other Forms of Deeds?

Arkansas recognizes two other types of deeds—called warranty deeds and quitclaim deeds— that also have names based on the warranty of title the provide (or don’t provide).

Arkansas Warranty Deed Form

An Arkansas warranty deed—also called an Arkansas general warranty deed—provides the buyer with the most protection of any type of deed. A general warranty deed provides a full warranty of title. The seller guarantees that the deed transfers clear and marketable title to the property. It also promises to defend the buyer’s title against any third-party claims against the property—regardless of when those claims arise.

A warranty deed’s warranty covers all potential title problems—even issues that existed before the seller acquired the property. In contrast, an Arkansas special warranty deed covers only title problems that may have arisen during the seller’s property ownership.

Arkansas Quitclaim Deed Form

An Arkansas quitclaim deed provides the buyer with no warranties or guarantees regarding the quality of the title being transferred. The current owner simply transfers any interest he or she has in the property to the new owner—with no promises or warranties about the property’s title. The new owner assumes the risk of any title problems or that the transferor does not actually own the property.

Arkansas Title Insurance and Special Warranty Deeds

A special warranty deed provides some protection to the buyer, but it does not offer as much protection as a warranty deed. Most buyers purchase title insurance to increase the protection a special warranty deed provides. A title insurance policy covers the financial loss the new owner sustains if it later turns out that the transferor did not own or have good title to the property that the special warranty deed transferred.

Arkansas Special Warranty Deed Forms and Other Arkansas Deeds Used in Estate Planning

An Arkansas special warranty deed also differs from two other types of Arkansas deeds named after their probate avoidance features: Arkansas life estate deeds and Arkansas beneficiary deeds.

Arkansas Life Estate Deeds

An owner who signs an Arkansas life estate deed transfers ownership of the property to a life tenant for the rest of his or her life. A life estate deed also gives another person—the remainderman or remainder beneficiary—the right to own the property after the life tenant’s death. An owner who creates a life estate deed for an estate plan usually keeps the life estate—which preserves the right to use and occupy the property during his or her lifetime. Once the life tenant passes away, ownership of the property automatically transfers to the remainder beneficiary.

A life estate deed is usually irrevocable. That means the owner cannot change his or her mind about the life estate deed and loses the right to sell complete ownership of the property unless the remainder beneficiary agrees to the sale.

Arkansas Beneficiary Deeds

An Arkansas beneficiary deed—also called a transfer-on-death (TOD) deed—designates one or more beneficiaries who will automatically receive ownership of the property upon the owner’s death. The current owner who signs the beneficiary deed keeps ownership of the property for life. The TOD deed automatically transfers ownership to the beneficiary or beneficiaries when the owner dies. The owner has the right to sell or transfer the property—or to revoke or amend the transfer-on-death deed—at any time during his or her lifetime.

A beneficiary deed allows property to bypass probate—like a right of survivorship between co-owners. However, a beneficiary deed gives the beneficiary no legal rights in the property until the current owner’s death (unlike a survivorship deed).

Common Uses of Arkansas Special Warranty Deed Forms

Special warranty deeds are often used in situations where the seller cannot provide a full warranty of title—such as when a bank or other institution is selling foreclosed properties or when selling property that has been inherited. Special warranty deeds can also be used when the parties are related—such as a transfer to add a co-owner or to pass title to a living trust or LLC controlled by the current owner. Arkansas real estate sales involving special warranty deeds are typically supplemented by title insurance.

How to Create an Arkansas Special Warranty Deed

Arkansas special warranty deed forms are based on Arkansas law, the customary practice of Arkansas attorneys, and title companies’ guidelines. An Arkansas special warranty deed’s granting language usually includes the words “grants, bargains, and sells.” An Arkansas deed with those words has an implied warranty that the transferor owns the property and has done nothing to impair its title.³ Special warranty deeds also typically include language that specifically defines the limited warranty—reducing the risk of disagreement over the warranty’s scope.

Special warranty deeds must satisfy the general requirements for all Arkansas deeds. Arkansas law sets formatting requirements for recorded deeds and requires deeds to include (among other things):⁴

• A document title;
• A legal description of the transferred property;
• The names of the parties and the person who prepared the deed; and
• A statement of consideration.

The deed must be signed by the grantor in the presence of a notary public, who then notarizes the document to make it legally binding.

1. Ark. Code § 18-12-102(b).
2. Ark. Code § 18-12-102(c).
3. Ark. Code § 18-12-102(b).
4. See Ark. Code §§ 14-15-402; 14-15-403.