Difference Between Grantor and Grantee (With Table)

Every domain and industry undergoes transactions. In every transaction of the fund, grant, asset, or trust, there is the involvement of two parties. Several legal associations are depending upon the type of transaction. One party provides or gives and the other party receives. These two parties are commonly called grantor and grantee.

Grantor vs Grantee

The main difference between grantor and grantee is that grantor is the person who can transfer the interest or the ownership of a trust or assets to a person, group, or entity while grantee is the person who acts as a recipient of that fund, grant, asset, real estate property or trust transferred by the grantor.

The grantor is the owner of the trust or asset and is ready to transfer the position of title to other identified beneficiaries. The grantor has the right to revoke and modify property or assets according to his/her wish and will. The grantor can also be called the trustor, first-party, lessor, or patron. The grantor can manage the trusts themselves or hire other trustees to do the same.

On the other hand, the grantee is the buyer or the beneficiary of the trust or asset. The grantee receives the title of the property given or sold by the grantor. Grantees have no right to modify or revoke the deed, trust, or asset unless bought and gained complete position. The grantee is also called the second party, recipient, or inheritor depending upon the domain of transfer.

Comparison Table Between Grantor and Grantee

Parameters of Comparison Grantor Grantee
Definition Grantor can be referred to any individual or entity that can create trust out of their assets Grantee is referred to the person who receives funds, grant, or property. The grant can be in the form of scholarship, real estate, or other assets
In real estate Grantor provides and passes property in or by deed Grantee buys and receives the property
In General warranty deeds Grantor provides series of promises that are legally bound Grantee receives the highest level of protection and warranty
In investment Grantor are investors who legally transfers, sells short a call option or a put option of a stock or other investmentsGrantee is the recipient of stock options
Other names First party, settlor, trustor and trustmaker, lessor, landlord, owner, patron Second party, recipient, buyer, beneficiary, legatee, devised, inheritor, the claimant

What is Grantor?

The grantor can be referred to any individual or entity that can create trust out of their assets. The grantor can also function as a trustee. Some other common functions and names of a grantor are settlor, trustor, and trustmaker. The grantor gives the assets to the identified beneficiaries.

Whenever a person sells out option contracts, the premium earned is by the grantor and is referred to as options writer. Depending upon the trust, the grantor can also act as a beneficiary and trustee or even both. All the assets in the trust are provided by the grantor. The other associated property and funds are under the ownership of the grantor.

The management of the property in the trust is also under the grantor. There are many trusts which are non-grantor and the control of the assets is relinquished. In this case, the trust usually functions as an entity of separate tax. The grantor is also called the settlor or creator as it can create trust. The transfer of ownership of the trusts or assets of the grantor is done through “deeds”.

The trusts of the grantor can be revocable. The grantor has the right to modify the terms of the trust. The grantor can even revoke the trust altogether. No other encumbrance can be made on the property by other parties who have not been disclosed by the grantor. The trustee is usually appointed by the grantor to make decisions and manage the trust and the assets.

What is Grantee?

The grantee is referred to as the person who receives funds, grants, or property. The grant can be in the form of a scholarship, real estate, or other assets. The grantee gets the ownership of the asset from a grantor. The grantee can be a recipient of any legal documents like deeds or others. Depending upon the type of legal document, the limitations of every document or deed are different and placed on the rights and interests.

The term grantee can be used in various content and across different domains, institutions, and industries. For example, in academics, a grantee can receive grants or scholarships while in real estate, a grantee would refer to the entity that takes title to the purchased property. In investing, the grantee word refers to the recipient of the stock options.

Not every deed renders power to the grantee. Like in real estate, a deed called quitclaim has no warranty in the status of the property’s title and can leave the grantee powerless if any title defects arise. But there are special warranty deeds too that assures the grantee that the asset is owned by the grantor.

The grantor-grantee index shows a complete record of the real estate that is transferred between the grantor and the grantee. It has detailed information about the release and transfer of ownership of the property. The grantee is also called the buyer.

Main Differences Between Grantor and Grantee

  1. A grantor can transfer the interest or ownership rights of an asset to another person or entity while a grantee is the recipient of those assets transferred.
  2. A grantor has the right to revoke the trust or asset while the grantee does not have any right to revoke.
  3. Grantor is the respondent while grantee is the petitioner.
  4. On legal documents, the grantor is on the bottom of the document while the grantee is on the top of the document.
  5. The grantor is the seller (in deeds) and borrower (in mortgages) while the grantee is the buyer, lienholder, or the new owner.

Conclusion

For every transfer and transaction, the two parties – grantor and grantee are involved. Grantor and grantee are universal terms and can be used in numerous domains. Both the parties are interdependent and interrelated to each other. The relationship is mutual and legal.

Several types of deeds can be issued depending upon the nature of the transfer. Adequate knowledge about the type of deed and its nature is essential for both parties to avoid any conflict or dispute later.

References

  1. https://dl.acm.org/doi/pdf/10.1145/344287.344300
  2. https://onlinelibrary.wiley.com/doi/abs/10.1002/nml.203
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