Property Title

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A property title specifies who owns the property.

What is a property title?

This is a document stating a right to ownership. In real estate, a title is not a physical document, but rather a concept that says you have the rights to use the property.

When you purchase a home, the lender will perform a title search. This search is the process of examining public records to confirm ownership and research any judgments or claims against the property. If the title is “free and clear,” the lender can then approve the loan for that property.

Property Deed versus Property Title

When you own a property, you will possess both the “deed” and “title”. Often, these two terms are used interchangeably, however, they are quite distinctive.

While the title refers to the ownership of the property, the deed is an actual legal document that transfers its title from one person to another. In other words, the title is the right to ownership, but the deed proves the title or proves ownership.

A property deed is sometimes referred to as the vehicle of the property interest transfer. This should be recorded in the courthouse or assessor’s office. Both the buyer and seller signs this physical document.

How to transfer a title?

When selling properties, you are transferring ownership of the property’s title. This transfer is done through the use of deeds.

First, select the type of deed for the title transfer. Then, fill in the names and addresses of the current property owner and the new owner. Next, record the legal address of the property, a description of the property, and the terms of the title transfer. After, sign all three copies of the deed with a notary present. Finally, file the deed at your local county recorder’s office and pay the necessary fee.

What is title insurance?

In the rare instances that title problems come up, title insurance helps protect against any financial loss. This insurance protects the buyer from events that have happened in the past.

For example, if there is a title error because of a paperwork mistake, delinquent liens on the property, or a claim that a third party is the real legal owner, title insurance can help with the costly legal expenses required to sort it all out.

You may have already purchased lender’s title insurance when you took out the mortgage. This insurance is usually a requirement because it protects the lender’s interest in your property as well as the homeowner’s interests.