New York Real Estate Practices

Attorney Involvement

Please describe any requirements under applicable state law for attorney, abstractor or other special professional involvement, for example, in the search, examination, opinion of title, signing, closing, disbursement, recording, preparation of documents, and/or policy-issuance.

Attorneys are involved in all aspects of the residential and commercial sale.  They negotiate the contract, hold earnest money deposits, review title certificates, draft conveyance documents and provide settlement services.  Typically, each party to a transaction has an attorney representing their interests.  In residential refinances, the attorney typically represents the bank only.  In some jurisdictions, attorneys also act as Title Agents.  However, there is no requirement for attorney involvement in the title search or the issuance of a title insurance policy.

Cancellation/Commitment Fee

Does your state permit or require a cancellation fee or commitment fee upon cancellation?

There are no restrictions or requirements relating to cancellation fees. 

Certificate of Release (of Mortgage)

If anyone other than the lender (such as a title agent, settlement agent, underwriter or attorney) has the authority to release the security instrument, please describe.

Only the lender of record can release/discharge a mortgage.

Deeds

Please describe the kinds of deeds that are customary for commercial and residential transactions.  Please describe the kinds of deeds that are generally not insurable.

Typical Deed is Bargain and Sale with Covenants against Grantor’s Acts.  Typically Quit claim deeds are not insurable. 

Joinder of Spouses

If a non-title holding spouse is required to join in the execution of a deed or a security instrument, please describe.  Any analogous rights, such as those in a civil union or equivalent, should also be addressed. 

There is no requirement to join a non title holding spouse. 

Liens and Limitations

Please contact a local state underwriter with any questions.

Federal and NYS Lien Chart

Mortgage Tax

Is there a mortgage tax in your state?  If yes, is it uniform across the state or does it vary?  If it is uniform, please describe.  

Mortgage recording tax is due on all mortgages over $10,000.00 in all counties in New York on the amount actually secured by the mortgage.  Some cities and counties impose additional mortgage recording taxes.  The tax rates vary by amount of mortgage, location and use of the property.  See NY Tax Law Section 250 et seq.

Payment Customs

Who customarily pays for:
(a) Owner’s Policy?
(b) Transfer Tax & Recording Fee?
(c) Survey Charges?
(d) Closing/Settlement Fees?

 

Who customarily pays for:
(a) Owner’s Policy: Buyer
(b) Transfer Tax & Recording Fee: Seller pays Transfer tax, Buyer pays fee to record deed and mortgage.
(c) Survey Charges: Buyer
(d) Closing/Settlement Fees:  Typically Buyer/Borrower

Policy Countersignatures

What kinds of countersignatures, if any, are required to issue the policy? 

There is no regulatory requirement for policy countersignatures.  Typically authorized signature requirements are governed by the underwriting agreement. 

Real Estate Taxes

Please describe the general tax year, due dates, and delinquency dates, including lien dates and payment cycle.

Taxes are assessed by each municipality, typically due 9/1 of each year for tax year 9/1 to 8/31, but may vary.  Taxes become due on the lien date, which is typically 9/1 but can be paid in installments.  Please consult a local underwriter for information relating to real estate taxes on the subject property.

Search and Examination Fees

Is it permissible and/or customary to charge a separate search and/or examination fee, and under what circumstances?  If your jurisdiction is all-inclusive, please state that.

There are two Zones in NY.  In Zone 1 (generally upper/western New York) a search fee can be charged.  In Zone 2 (generally lower/eastern NY) the premium is all inclusive (i.e., it includes the search cost), but an additional search fee can be charged for multiple properties. Refer to TIRSA Rate Manual Part 1 Rules and Definitions Paragraph (F) and for Zones and counties.  Premium rates for both Zones do not include the cost for municipal department searches.

Search Requirements

Is there a minimum period of time for a title search required: (a) by state law, (b) pursuant to marketable record title acts, or (c) by any other applicable title examination standards (e.g., state bar association)?  Please respond to each category.  If a minimum search period exists for any category, please state it.

Searches are typically 40 to 60 years. 

Security Instruments (Deed of Trust vs. Mortgage)

Please describe the customary and permissible form(s) of security instruments used in your state. 

Who can be listed as the trustee on the Deed of Trust (e.g., residency and/or natural person requirements, etc.)? Can an underwriter or title agent be designated as the trustee, and, if so, is it customary?

Mortgage only.

Standard Exceptions and Requirements

Please identify the standard exceptions and requirements that are customarily used in your state.

The following are typical exceptions, subject to variation by county and local custom:

Rights or claims of parties in possession not recorded in the Public Records.

Easements or claims of easements not recorded in the Public Records.

Any state of facts an accurate survey would show.

Any lien, or right to a lien, for services, labor, material or equipment, heretofore or hereafter furnished, imposed by law and not recorded in the Public Records.

Taxes or assessments which are not recorded as existing liens in the Public Records.

Contact local Underwriter for local variations. 

State-specific Policy Variations

If there are state-specific changes to the provisions in the ALTA policies (e.g., Arbitration, Minerals), please describe.

TIRSA 2006 ALTA policy and endorsements only as approved by the New York State Department of Financial Services and in the TIRSA Rate Manual.

Title Insurance Form and Filing Regulations

Please describe the form and/or rate filing requirements, if any, related to policies and endorsements.  Please describe any applicable rating bureau.

Forms and rates are governed by the Title Insurance Rate Service Association, Inc. (TIRSA) Title Insurance Rate Manual, which is filed with and approved by the New York State Superintendent of Insurance.  www.tirsa.org

Transfer Taxes

Is there a transfer tax in your state? If yes, is it uniform across the state or does it vary?  If it is uniform, please describe.

Transfer tax is payable in every county and in some cities.  The tax rate varies by location and use of the property.  See NY Tax Law 1400 et seq.

Usury

Is usury coverage available?

Not available.

Withholding Taxes

What are your state’s requirements, if any, with regard to withholding proceeds from a sale, similar to but not including FIRPTA?

Nonresidents must compute the gain (or loss) and pay any estimated personal income tax due from the sale or transfer of certain real property, including cooperative units.

Witness Requirements

Are witnesses required on a deed or security instrument?  If so, please describe.

No witness required.