‹ Back

Understanding the 5 Different Types of Deeds in New York State (Including the New Transfer on Death Deed – TODD)

 

When buying or transferring real estate in New York State, the type of deed you use matters. Deeds are legal documents that transfer ownership from one party (the grantor) to another (the grantee). But not all deeds provide the same level of protection. Some guarantee a clear title, while others transfer ownership with little to no promises.

 

In this post, we’ll break down the five main types of deeds in New York, including the newly introduced Transfer on Death Deed (TODD), so you can understand which one best suits your real estate transaction.

 

1. Warranty Deed (Full Covenant and Warranty Deed)

A Warranty Deed—also known as a Full Covenant and Warranty Deed—provides the highest level of protection for buyers. The grantor guarantees that they have a clear title to the property and will defend the grantee against any future claims.

Key Features:

    ✅ Grantor guarantees they own the property outright.
    ✅ Grantor promises the title is free of liens, claims, or encumbrances (except those disclosed).
    ✅ If a title issue arises later, the grantor is legally responsible.
    ✅ Most commonly used in residential real estate sales when a buyer is financing with a mortgage.

Best For:

• Buyers who want maximum protection.
• Transactions where title insurance may not be enough security.
• Sellers who are willing to guarantee a clear title.

💡 Example: A homeowner sells a house to a new buyer using a Warranty Deed. If a hidden lien or ownership dispute arises later, the seller is legally responsible for fixing it.

 

2. Bargain and Sale Deed (With or Without Covenants)

A Bargain and Sale Deed is the most common type of deed in New York, especially in foreclosures, estate sales, and transactions between known parties. This deed implies that the grantor has ownership of the property but doesn’t guarantee the title is free of issues—unless covenants (promises) are included.

Two Types of Bargain and Sale Deeds:

1. With Covenants: The grantor promises they haven’t caused any title issues while they owned the property.
2. Without Covenants: The grantor makes no guarantees about the title, meaning past title issues may still exist.

Key Features:

    ✅ Commonly used in New York real estate transactions.
    ✅ Often seen in foreclosures, estate sales, and tax sales.
    ✅ Less protection than a Warranty Deed but more than a Quit Claim Deed.
    ✅ If a mortgage is involved, banks usually require a Bargain and Sale Deed with covenants.

Best For:

• Buyers purchasing foreclosures or estate-owned properties.
• Sellers who want to transfer property without full warranty liability.

💡 Example: A home is sold from an estate to a new buyer. The estate executor uses a Bargain and Sale Deed with Covenants, guaranteeing that no new liens were placed on the property while the estate owned it. However, past issues before the estate's ownership aren't covered.

 

3. Quit Claim Deed

A Quit Claim Deed provides the least amount of protection for the grantee. It simply transfers whatever interest the grantor has in the property—if any—without making any guarantees.

Key Features:

    ✅ The grantor makes no promises about title issues or ownership status.
    ✅ Commonly used for transfers between family members, divorces, or moving property into a trust.
    ✅ Cannot be used to remove someone from a mortgage—only from the deed.
    ✅ Since there are no warranties, title insurance companies may be reluctant to insure the transaction.

Best For:

• Family transfers (e.g., adding/removing a spouse from a deed after marriage or divorce).
• Transferring property into a trust for estate planning.
• Correcting errors on an existing deed (e.g., fixing a misspelled name).

💡 Example: A homeowner places their property into a revocable trust for estate planning purposes. They use a Quit Claim Deed because no warranties are needed—the trust is just another way they own the property.

 

4. Referee’s Deed

A Referee’s Deed is a special type of deed used in foreclosure sales or when a court orders the sale of a property. Unlike other deeds, this one is issued by a court-appointed referee rather than the property’s owner.

Key Features:

    ✅ Used in foreclosures, partition actions, or court-ordered property sales.
    ✅ Offers no guarantees about the title—buyers purchase “as-is.”
    ✅ Title insurance is highly recommended because prior liens or claims may still exist.

Best For:

• Investors buying foreclosed properties at auction.
• Heirs involved in partition sales where a court orders the sale of inherited property.
• Buyers willing to take on title risks in exchange for a lower purchase price.

💡 Example: A home is foreclosed due to unpaid mortgage payments. At a foreclosure auction, the highest bidder receives a Referee’s Deed—but any undiscovered liens or title issues become the buyer’s responsibility.

 

5. Transfer on Death Deed (TODD) – New in New York!

As of 2024, New York has officially adopted the Transfer on Death Deed (TODD) under Real Property Law § 424. This new deed allows property owners to name a beneficiary who will automatically inherit the property upon their death without the need for probate.

Key Features:

    ✅ The owner retains full control over the property while alive.
    ✅ The deed only takes effect upon the owner’s death.
    ✅ The property avoids probate, making inheritance much easier.
    ✅ The owner can revoke or change the deed at any time.
    ✅ Great for estate planning—simplifies transferring real estate to heirs.

Best For:

• Homeowners looking for a simple way to pass property to heirs without probate.
• People who don’t want to use a trust but still want to avoid probate.
• Aging homeowners planning their estate.

💡 Example: A widow wants to ensure her house goes directly to her daughter upon her passing. She signs a Transfer on Death Deed naming her daughter as the beneficiary. When she passes away, the daughter automatically inherits the property without going through probate.

Which Deed is Right for You?

Deed Type	Guarantees Clear Title?	Best For
Warranty Deed	✅ Yes, fully guaranteed.	Traditional real estate sales with maximum buyer protection.
Bargain and Sale Deed	⚠️ Only if covenants included.	Foreclosures, estate sales, and NYC property transfers.
Quit Claim Deed	❌ No guarantees.	Family transfers, trusts, and correcting deeds.
Referee’s Deed	❌ No guarantees.	Foreclosures and court-ordered sales.
Transfer on Death Deed	✅ Avoids probate but no title guarantees.	Estate planning and seamless inheritance.

 

Final Thoughts

With the new Transfer on Death Deed (TODD) now available in New York, homeowners have another option for simplifying inheritance and avoiding probate. However, it’s still important to consider title insurance, potential liens, and estate planning goals when choosing the right deed.

 

📌 Thinking about transferring property? Consult a real estate attorney to ensure you're making the best decision!

Have questions about real estate deeds in New York? Drop them in the comments! 🏡👇