Colorado Sales License Practice Test

A deed is the legal document that officially transfers ownership of property from one party to another. It serves as the formal record that shows who holds title to the property and is executed by the grantor (the seller) and delivered to the grantee (the buyer). The deed includes important details such as the names of the parties involved, a description of the property, and the signatures necessary to validate the transfer. This document is typically recorded in the public records to protect the new owner's interest in the property.

In contrast, a promissory note is a financial agreement wherein the borrower promises to repay a specified amount to a lender, but it does not transfer property ownership. A purchase agreement is a contract that outlines the terms of the sale between the buyer and the seller, but it does not constitute the actual transfer of ownership. An inspection report provides information about the condition of the property, but it is not involved in the transfer process itself.