Grantee

A grantee is the party who receives an interest in real property through a deed or other conveyance document. The grantee is the recipient — the person or entity to whom ownership, a lien, or another real property interest is being transferred. The counterpart is the grantor, who is the party giving up or transferring that interest.

Grantor vs. Grantee

Every property transfer involves two parties:

The grantor-grantee relationship appears on every recorded deed in the county records. When a property changes hands — whether through sale, inheritance, gift, or legal proceeding — the transaction is documented by a deed that names the grantor and grantee.

Where Grantees Appear in Note Investing

In mortgage note investing, the grantee designation shows up in several critical documents:

Deeds

When a borrower originally purchased the property, they were the grantee on the deed from the seller. If the note investor later takes the property through foreclosure or deed-in-lieu, the investor (or their entity) becomes the grantee on the new deed.

Assignments of Mortgage

When a mortgage is transferred from one note holder to another, an assignment is recorded. The party receiving the mortgage interest — the buyer — is the grantee (sometimes called the "assignee"). Verifying that the grantee on each assignment matches the next grantor in the chain of title is a fundamental step in collateral file review and due diligence.

Deed-in-Lieu of Foreclosure

In a deed-in-lieu transaction, the borrower (grantor) voluntarily transfers the property to the note holder (grantee). The deed-in-lieu agreement must specifically identify both parties — the borrower as grantor and the note holder or their entity as grantee — along with a full legal description of the property.

Quit-Claim Deeds

A quit-claim deed transfers whatever interest the grantor has in the property to the grantee, with no warranties about the quality of that interest. Note investors encounter quit-claim deeds during title searches — they may indicate informal property transfers between family members that can complicate chain of title.

Grantee Indexes and Title Searches

County recorders maintain grantor-grantee indexes that allow anyone to search recorded documents by party name. During a title search, the examiner traces the history of the property by following the grantor-grantee chain:

1. Start with the current owner (the most recent grantee)
2. Trace backward through each deed, confirming that each grantee became the grantor on the next transfer
3. Identify any gaps, errors, or unrecorded transfers that could create a cloud on title

A break in the grantor-grantee chain — where a deed was signed by someone who was never recorded as the grantee on a prior deed — creates a title defect that must be resolved before the property can be conveyed with clear title.

Practical Considerations for Note Investors

• Entity name accuracy — when the note investor is the grantee, the name on the deed must exactly match the legal name of their entity. Errors in the grantee name on a recorded deed can create title issues that are expensive to correct.
• Vesting — the deed should specify how the grantee holds title (individually, as tenants in common, as a member of an LLC, etc.). Incorrect vesting can create problems during future sales or transfers.
• Recording — a deed is not effective against third parties until it is recorded in the county records. The grantee should ensure prompt recording to protect their interest.
• Tax implications — the grantee establishes their tax basis in the property at the time of transfer, which matters for depreciation, capital gains, and other tax calculations.