Grantor vs Grantee

Article byWallstreetmojo Team
Edited byAlfina
Reviewed byDheeraj Vaidya, CFA, FRM

Difference Between Grantor and Grantee

Grantor and Grantee are two parties involved in a typical real estate transaction, like lien, mortgage, or deed. The grantor is the one granting away or transferring the property rights to the grantee, who is the receiver. 

For example, the landlord is the grantor in a rent or lease agreement, while the tenant is the grantee. The grantor is also called a first-party while the grantee is referred to as the second party in a transaction.

Grantor-vs-Grantee

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Comparative Table

GrantorGrantee
DefinitionThe person or entity who is the owner or seller of a real estate assetThe entity who is a buyer, tenant, or borrower for a real estate property
Other titles Usually, they are owner, seller, landlord, the lessor of the property Could also include tenant, buyer, lessee, etc. 
Property rights Transfers property rightsReceives property rights
Deed Signs at the bottom of the page The deed is usually made in the name of the grantee
InvestmentSells or put options of the stock or other securities Recipient of investments

What is Grantor?

In a legal contract concerning an exchange or transfer of an asset, the grantorGrantorA grantor refers to a person who has created a trust to manage his/her assets and legally transfer them to the beneficiary to avoid inheritance issues. For instance, a grantor could be a father who has created a trust to control and manage his real estate property, money, and investments and transfer them to his family upon his demise. Since it is a legal process, management, taxation, and transfer terms are specified in the agreement or a deed.read more is the person who owns the asset or happens to be the seller of the said asset. For example, the grantor would be the owner or lessorLessorA lessor is an individual or entity that leases out an asset such as land, house or machinery to another person or organization for a certain period.read more of a building or a house in the case of real estate. The grantor would normally transfer title and property rights to the grantee in a document known as the deed.

Almost always, the grantor has all legal rights on a piece of property before the signing of an agreement. The grantor holds the sole right to modify the assets as they please. They can either manage the property themselves or hire a trusteeTrusteeA trustee is an individual or institution with legal authority to manage the trust property and assets on behalf of the settlor to benefit the beneficiary. They have complete control over the trust assets until they get transferred to the beneficiary. The administration of assets goes as per the directions of the trust. read more. Any remaining rights the grantor may have on the property will be mentioned within the clauses of the agreement.

In most legal drafts, the name of the grantor will be at the bottom of the page since they usually have to sign off the document over to the grantee.

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What is Grantee?

The grantee is the individual or entity in a legal document who is usually the asset’s buyer, borrower, or lesseeLesseeA Lessee, also called a Tenant, is an individual (or entity) who rents the land or property (generally immovable) from a lessor (property owner) under a legal lease agreement. read more.

In a legal deed, the grantee would be the one taking possession of a house or money or anything else in which the grantor transfers title in the deed. For example, in an agreement for a mortgage, the bank assumes rights over a real estate asset and is the grantee while the individual applying for the loan becomes the grantor. Unlike the grantor, the grantee has no right to modify the property or revoke the deed till the completion of a transaction.

Suppose a grantee who has taken possession of the house now approached a bank for a mortgage and had to put the house down as collateral. Now the roles would get interchanged, and the bank would become the new grantee. 

In most cases, the person or entity receiving the property rights is the grantee, while the one transferring it is the grantor.

Grantor vs Grantee Infographics

Grantor-vs-Grantee-info

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Final thoughts

The nature of the relationship between a grantor and grantee can differ according to the type of real estate transaction and the deeds involved. The official documents or deeds such as warranty deedWarranty DeedA warranty deed refers to a legal document assuring that the seller is the property owner and has the free and clear right to transfer the ownership title to the buyer. It also promises that the property is free from any debts or claims.read more, deed of trust, quitclaim deed, etc. would contain the detailed specifications of this relationship. Title searches and title insurance ensures that the deed is clean and buyers are protected in the case of any dispute. Property rights and the laws governing them may change from state to state. But the titular role of the grantor and grantee remains the same.

This has been a guide to Grantor vs grantee. Here we discuss the top 5 differences between grantor and grantee along with infographics. You may also have a look at the following useful articles –