A warranty deed is a deed in which the seller (the grantor) legally guarantees that the title being transferred is clear of all prior claims, liens, and ownership defects, and promises to defend the buyer's title against any that surface later. It is the strongest form of ownership transfer a buyer can receive, because the seller is personally on the hook for problems that trace back to any point in the property's history, not only the years the seller owned it.
The promises baked into a general warranty deed are usually called covenants: that the grantor owns the property, has the right to sell it, that the title is free of undisclosed encumbrances, and that the grantor will defend the buyer if a claim appears. Exact wording and the names of these covenants vary by state, so the operative protection is whatever your deed and statute actually say.
In practice
Say you buy a fourplex for $480,000 and receive a general warranty deed at closing. Two years later a contractor who did roof work for the previous owner files a mechanic's lien for $9,200, claiming he was never paid for a job done before you ever saw the building. Because the prior owner conveyed the property with a warranty deed, that claim is the grantor's problem, not yours. The grantor's covenant to defend title covers a defect that originated during their ownership.
Contrast that with a quitclaim deed on the same fourplex. A quitclaim transfers only whatever interest the seller happens to have, with zero promises. If the $9,200 lien showed up under a quitclaim, you would have no recourse against the seller and would likely pay it yourself to clear the title. The dollar gap between those two outcomes, $9,200 here, is exactly what the warranty covenant is worth.
Why it matters to a small landlord
When you buy a rental, the deed type sets the floor on your title risk. A warranty deed plus a clean title search is the standard you should expect on an arm's-length purchase. Be cautious when a seller offers only a quitclaim, common in family transfers, tax sales, and distressed deals, because you inherit the title risk without any backstop. The purchase price and the closing paperwork are line items you carry for years, so it is worth tracking what you actually received. If you keep a record of each property's acquisition details, the deed is one of the documents that belongs in your due diligence file for that building, alongside the title commitment and the closing statement.
One more note: a warranty deed protects you against title defects, but it does not insure you against the cost of litigating one. That is a separate product, and the closing paperwork on most financed purchases will already include it. See how the deed fits with the rest of your closing costs before you assume you are fully covered.
A warranty deed is one rung on the title-risk ladder. Below it sits the quitclaim deed, which promises nothing. The claims a warranty deed defends against are usually a lien recorded against the property, and the policy that pays the legal bill when one appears is title insurance. Read the deed you sign, and read your state's statute for the exact covenants it carries.