In a real estate transaction, what is the purpose of a deed?

A deed serves a fundamental purpose in a real estate transaction: it formally conveys the title of a property from the seller to the buyer. This legal document signifies the transfer of ownership, providing essential details such as the identification of the parties involved, the property description, and any conditions of the transfer. When a deed is executed and delivered, it establishes the buyer’s legal right to the property, which is crucial for ensuring that the buyer has proper title and can exercise ownership rights.

Other options do not accurately define the primary role of a deed in the context of real estate transactions. For instance, while establishing the property's value may be necessary in the transaction process, it is not the function of the deed. Similarly, documentation of a buyer's financial responsibility is typically handled through separate financial documents, and the creation of a mortgage agreement pertains to financing, rather than the conveyance of title, which is the main purpose of a deed. Therefore, the deed is instrumental in finalizing the transfer of property ownership, making its purpose clear and distinct in real estate dealings.