Bargain and Sale vs. Quitclaim Deeds: A Concise Guide

Are you looking to buy a home though a bargain and sale deed? Perhaps you’re buying after a foreclosure, or from an estate or a court-ordered sale. If so, the entity granting the deed to you might lack knowledge of the property’s history. Basically, the deed means a buyer is expected to accept the house as-is.

How does this differ from a quitclaim deed? What rights and protections does the bargain and sale deed give you, the new owner? Let’s take a look.

Comparing and Contrasting the Deeds

Bargain and sale deeds tend to be used to transfer property among family members and family trusts in Colorado, New York, Vermont, Washington, and Wyoming, too. So, you might wonder, is a bargain and sale deed just my state’s version of a quitclaim deed?

It’s the quitclaim deed that’s most widely associated with property transfers without warranties. But there are key differences between the two deeds.

Quitclaim deeds are commonly seen when family members transfer houses to each other, into an LLC, or into or out of a trust. Sometimes they are used as release deeds, to clear up ambiguities in the chain of title. Subsequently, the interest can be conveyed through a warranty deed. Quitclaim deeds can shift the deed into a new name after the owner has a name change. When are they not typically used? To sell houses.

The quitclaim deed provides no warranties; it conveys the interest the grantor had in the property—nothing more.

A quitclaim deed is used either when the grantor has no need to guarantee title, or when the grantor’s title is unclear.

Quitclaim deeds are most often used when there is no sale—to transfer property between friends, partners, or family members, or between owners and their LLCs.

A person might also sign a quitclaim to clear up a title ambiguity.

Bargain and sale deeds, as the term suggests, is used in a sale. Unlike a quitclaim, the bargain and sale deed indicates that the grantor has the title and can convey it to a buyer. The grantee—you, if you’re receiving the deed—gets not only the property, but also any significant liens and encumbrances it might carry.

Bargain and sale deeds are used in real estate deals and to transfer seized property. In a foreclosure or tax sale, the entity transferring the title does not occupy the land, and makes no assurances about its title history.

The bargain and sale deed indicates that the grantor has title; but property might come with encumbrances and defects.

Receiving any non-warranty deed can affect your ability to obtain title insurance coverage and guard against future claims.

Warranty deeds, unlike the two non-warranty deeds we’ve just described, are standard when a seller transfers a title to a buyer in a regular sale through the real estate market. With a warranty deed, the buyer gets guarantees that the seller has full rights to transfer the home, an no other party has any claim or lien on the house or its land that could jeopardize the buyer’s rights.

In short, a bargain and sale deed offers more protection against title defects than a quitclaim deed does, but is not as ironclad as a warranty deed.

Can You Insure a Quitclaim or Bargain and Sale Deed?

Close up image of a dark red door on a house. Captioned: Bargain and Sale Deed vs. Quitclaim Deed

In a home transfer, the conveyance is represented by the deed; and each type of deed carries a certain level of protection against title defects. Different types of deeds offer different levels of protection to the new owner. Debts and defects aren’t always obvious. So, to prevent any claims in the future, can a title company insure a non-warranty deed

Getting insurance for a non-warranty deed can take extra steps. In some situations, an owner might need to undergo a certification process to verify that the title’s integrity was maintained through the seizure and sales processes. As a final recourse, an owner may pursue a quiet title action so the county court can affirm that no one else has a stake in that property, and the owner is rightfully placed in the chain of title.

A bargain and sale deed may or may not be insurable. It may come with or without covenants (as explained further in the section below). If it comes without covenants, it provides weak protection for the buyer. It will not be accepted by lenders in some states—New York, for example—if you are trying to finance the home. 

Pro tip: Before buying a home to be conveyed with an instrument other than a warranty deed, a buyer can reach out to a title insurance specialist and a real estate attorney. Accepting either a bargain and sale deed or a quitclaim deed could adversely complicate the process of getting your own title insurance and protection against unanticipated claims in the future.

Bargain and Sale With Covenants

If a bargain and sale deed comes with expressly stated guarantees beyond simple ownership rights, it is known as a bargain and sale deed with covenants. The grantor of such a deed is guaranteeing the property against any possible claims expressly covered by the covenant. It might, for instance, offer a covenant to protect the buyer against the grantor’s acts. It may contain assurances that no outstanding liens or encumbrances exist.

Here are a few frequent examples of the liens and encumbrances you’d want to avoid.

  • Tax liens. Unpaid taxes on the real estate can lead to a tax lien. Should you try to sell the home at some point, the government lien will have priority and must be paid off with any penalties and interest charged. Ultimately, a tax lien can lead to foreclosure.
  • Judicial liens. Court cases can survive the bargain and sale conveyance. Old judicial liens, though, can expire when enough time passes under the limit set by the state.
  • Local assessments, fines, and fees. If a prior owner failed to pay off debts for common infrastructure and services, there could be a variety of liens on the house.
  • Homeowners’ association fines and dues. A condo property considers various forms of unresolved debts and fines for homeowner violations lienable, subject to recording at the county courthouse. 
  • Mortgage liens. Do not neglect the possibility that another mortgage company, bank, or other party has a claim. The property might have had mortgages or secured loans lurking at the time of sale that could lead to foreclosure if left unresolved. 
  • Mechanics’ liens. Bargain and sale deeds can transfer homes that have had repairs or construction which the previous owner never resolved. These liens can rack up interest and should be resolved sooner rather than later.

To read more about these and additional title issues, see 7 Common Title Problems in Real Estate Deals on

What to Know Before You Close

Be sure your deed complies with the law of the state where the property is. A valid bargain and sale deed states the name of the grantor and grantee (parties transferring and taking title), and a declaration that the grantor is conveying the title to the named grantee. It sets forth the complete legal description of the property, and is signed and dated by the grantor. State law has specific requirements to follow.  Here are Oregon’s, which exemplify the way a bargain and sale deed transfers the grantor’s interest in the property without supplying further guarantees. Generally, the deed must be signed by the parties and two disinterested witnesses (not spouses) before a notary public.

For the strongest protection, ask your realtor to press the seller to provide you with a warranty deed. If you are financing your purchase, the lender will insist on title insurance, which you will pay for. To be sure you can insure your purchase, a title company will likely need the warranty deed.

If you are unable to purchase your new home with a general warranty deed, we recommend consulting with a real estate lawyer who can assist you with negotiations and the purchase. A real estate lawyer can research the facts, documents, state laws, and case law, and can discuss your questions and concerns about potential issues and remedies.

Photo credit: Dele Oke, via Unsplash.