A bargain and sale deed in NY is the standard instrument used to transfer ownership of real estate, and it implies the seller holds title without guaranteeing the title is free of every possible defect. It comes in two statutory versions under Section 258 of New York’s Real Property Law: one with a covenant against the grantor’s acts, and one without.1New York State Senate. New York Real Property Law 258 – Short Forms of Deeds and Mortgages Which one you receive controls how much the seller is on the hook for if a title problem surfaces after closing.
The Two Versions and What They Actually Promise
Schedules C and D of Section 258 cover the version without covenants (for individuals and corporations). Schedules E and F cover the version with covenants against the grantor’s acts.1New York State Senate. New York Real Property Law 258 – Short Forms of Deeds and Mortgages
With Covenants Against Grantor’s Acts
This is the workhorse deed in New York closings. The covenant is a promise from the seller that they personally have not placed liens, easements, or other encumbrances on the property during their ownership. That protection is narrower than it sounds. If a prior owner granted an easement or left an unpaid lien, the current seller owes you nothing for it. The covenant only reaches the seller’s own conduct, which is where most buyer claims collapse.
Without Covenants Against Grantor’s Acts
The version without covenants transfers whatever interest the seller holds and makes no promise about the title’s history at any point.1New York State Senate. New York Real Property Law 258 – Short Forms of Deeds and Mortgages You will see this version at foreclosure auctions, tax lien sales, and in estate transfers where the executor cannot verify the title history firsthand. Sellers in those situations lack personal knowledge of the property, so even a limited covenant would expose them to liability they cannot assess.
How It Compares to Other New York Deeds
The bargain and sale deed sits in the middle of New York’s protection spectrum. Knowing where helps you judge the risk you are accepting.
- A full covenant and warranty deed guarantees the title is free of all defects, including problems created by prior owners. If a claim surfaces, the seller is responsible. It offers the most protection but is less common in New York than in many other states.
- A bargain and sale deed with covenants guarantees only that the seller has not encumbered the property. Prior-owner problems are the buyer’s concern. This is the standard New York deed.
- A bargain and sale deed without covenants transfers ownership with no guarantees at all.
- A quitclaim deed transfers whatever interest the seller may have, without even implying they hold valid title. It shows up between family members, in divorces, or to clear a cloud on title, rather than in arm’s-length sales.1New York State Senate. New York Real Property Law 258 – Short Forms of Deeds and Mortgages
If you are coming from another state, a bargain and sale deed with covenants functions like what many jurisdictions call a special warranty deed. The full covenant and warranty deed is New York’s equivalent of a general warranty deed.
What the Deed Must Contain
Every bargain and sale deed needs the full legal names of the seller and buyer, the consideration paid, and a legal description of the property. The legal description typically uses metes and bounds, tracing the boundary lines from a fixed starting point around the entire perimeter so there is no ambiguity about what land is being transferred.
The deed must also state that the seller grants and releases the property to the buyer “and assigns forever,” which establishes that full ownership is being transferred rather than some limited interest. When the deed includes the covenant against the grantor’s acts, the covenant language appears at the end, just before the signature line.1New York State Senate. New York Real Property Law 258 – Short Forms of Deeds and Mortgages
Signing and Notarization
The seller signs the deed in front of a notary public. New York requires the notary to attach or endorse a certificate of acknowledgment confirming the signer’s identity and that the document was signed voluntarily.2New York State Senate. New York Real Property Law 306 – Certificate of Acknowledgment or Proof The acknowledgment must follow the statutory format identifying the state, county, date, and signer.3New York State Senate. New York Real Property Law 309-A – Uniform Forms of Certificates of Acknowledgment or Proof Within This State Without a properly formatted acknowledgment, the recording office will reject the deed.
Recording the Deed
Recording puts the public on notice that you own the property. Under New York law, an unrecorded deed is void against a later buyer who purchases the same property in good faith, pays value, and records first.4New York State Senate. New York Real Property Law 291 In practice, recording is not optional.
Where to File
For properties in Manhattan, Brooklyn, Queens, and the Bronx, you record through the Automated City Register Information System (ACRIS), which handles the electronic preparation and filing of deeds and tax forms.5NYC Department of Finance. Property Related Documents Staten Island records with the Richmond County Clerk, though the NYC real property transfer tax return still runs through ACRIS.6NYC.gov. Recording Documents Everywhere else in the state, you file with the county clerk where the property sits.
Fees
Recording fees generally include a base charge of $45 plus $5 per page. Some counties add supplemental charges, such as a $10 notice-of-transfer fee on residential recordings.7Sullivan County NY. Recording a Deed Transfer taxes are due at filing and are separate from recording fees.
Once the office accepts the deed, it assigns an instrument number or a book and page reference for public indexing. The original deed is returned to the buyer after processing and imaging. Most offices provide a stamped copy as proof of filing in the meantime.
Transfer Taxes You Will Owe at Closing
New York imposes a state transfer tax on every conveyance where the consideration exceeds $500. The base rate is $2 per $500 of consideration, which works out to 0.4%.8New York State Senate. New York Tax Law 1402 – Imposition of Tax The seller is typically responsible, though the parties can negotiate otherwise.
Mansion Tax
An additional 1% tax applies to residential transfers where total consideration is $1 million or more. The mansion tax is calculated on the full purchase price, not just the amount above $1 million, and the buyer typically pays it.9New York State Department of Taxation and Finance. Real Estate Transfer Tax – Tax Expenditure Estimates
Additional Tax for High-Value NYC Transfers
Conveyances within New York City face a supplemental state transfer tax of $1.25 per $500 of consideration on residential properties at $3 million or more, and on other property types at $2 million or more.8New York State Senate. New York Tax Law 1402 – Imposition of Tax
NYC Real Property Transfer Tax
New York City layers its own transfer tax on top of the state tax. For residential properties, the rate is 1% when consideration is $500,000 or less and 1.425% above that. For commercial and other transfers, the rates are 1.425% and 2.625% at the same threshold.10NYC.gov. Real Property Transfer Tax A buyer purchasing a $750,000 apartment in Brooklyn would face 0.4% state transfer tax plus 1.425% city transfer tax before considering any other charges.
Peconic Bay Region Transfer Tax
Properties in East Hampton, Riverhead, Shelter Island, Southampton, and Southold pay a 2% community preservation fund transfer tax plus an additional 0.5% community housing fund tax.11Suffolk County. Peconic Bay Region Community Preservation Fund A first-time homebuyer exemption exists for qualifying buyers who meet income and purchase price limits.12Town of Southampton. First Time Homebuyer Exemption Information
Required Tax Forms
Two state forms must accompany the deed when it is submitted. The county clerk will reject the package if either is missing or incomplete.
Form TP-584 is the combined real estate transfer tax return. It calculates the state transfer tax owed and also serves as the credit line mortgage certificate and the certification of exemption from estimated personal income tax on the sale.13New York State Department of Taxation and Finance. Instructions for Form TP-584 Every figure on the TP-584 must match the sales contract exactly. Mismatches between the deed, the contract, and the tax forms are one of the most common reasons filings get kicked back.
Form RP-5217 is the real property transfer report. It captures transaction data including sale price, property classification, and tax map identifiers for the county’s assessment records. The form must be completed digitally in Adobe Acrobat because the clerk reads a scannable barcode embedded in the PDF. Hand-completed versions are rejected.14New York State Department of Taxation and Finance. RP-5217-PDF Real Property Transfer Report Instructions
Why Title Insurance Matters With This Deed
Because even the stronger version of the bargain and sale deed only covers problems the seller personally caused, title insurance has to carry the rest. A prior owner’s unpaid tax lien, a forged deed somewhere in the chain of title, or an undisclosed heir with a claim to the property all stay on the buyer’s shoulders under a bargain and sale deed.
A lender’s title insurance policy is required if you are financing the purchase; it protects the bank’s investment in the mortgage. An owner’s title insurance policy is optional and covers you personally if a title defect surfaces after closing. In New York, owner’s title insurance premiums generally run between 0.5% and 0.7% of the purchase price. On a $600,000 home, that is roughly $3,000 to $4,200 as a one-time cost at closing. Given how little the deed itself warrants, skipping the owner’s policy is a gamble most buyers should not take.