It is very common for real estate terminology to be confusing. Even after passing your real estate exam, you probably won’t know the 100s of terms out there. But rest assured, after a few years of experience you will have a firm grasp on most of it.
Among so many, there are two concepts that are often related but have different meanings and are constantly confused. For example: Title and deed. By reviewing in detail the definition of each of these, we can notice their great difference.
In this sense, we have made a brief guide with the most important details about Title and Deed so that you can differentiate them quickly and without inconveniences. Definitely, if you are in the process of buying a property or expect to be soon, this article will be very useful.
Table of Contents
What is a Title?
Titles refer to the ownership of property. That is to say, to the ownership of the property. The way to prove such ownership is by means of a title, which is the legal document that certifies the ownership of the property or asset.
Some of the characteristics that include a title deed are:
- Right of possession: It confirms that you are the owner of the property.
- Right of control: Allows you to do what you want with the property.
- Right of Exclusion: Allows you to decide who does or does not enter your property.
- Right of disposition: Allows you to sell the property whenever you wish.
If the purchase of the property is made by means of a loan, the title will belong to the lender and once there are no debts, the title will be transferred to the owner. In other words, the title to a home grants you all rights, control and responsibilities over that home.
Another point of confusion regarding title is that it is not necessarily individual. A title can be owned by one or more persons, corporations, partnerships, trusts, organizations, among other entities. Of course, by sharing a title, the rights, duties or obligations surrounding that ownership are also shared.
What is a Deed?
Specifically, a deed refers to the legal document that validates the transfer of ownership from one person to another. For example, at the time of the sale of a property, the owner transfers all rights to the buyer, by means of the deed. Upon completion of the transfer, the buyer becomes the new owner of the property. The deed is the physical proof of this transfer.
However, there are different types of deeds. These are the most common:
- General Warranty Deed
- Special Warranty Deed
- Quitclaim Deed
- Negotiation and Bill of Sale
A simple way to identify the deed: the document or paper that indicates that you are the owner of a property. Of course, in order to make the transfer of ownership official, it must be signed by both parties and then notarized to certify the process.
Difference between Title and Deed
It is normal that the terms “title” and “deed” can be confused. However, once you identify their main differences, it will be much easier to differentiate between them.
Although in practice, the difference between title and ownership is more extensive, it can be summarized as follows:
- The deed is the physical document that certifies that you are the owner of a property.
- The title is a legal definition that gives you rights to the property.
It is always recommended to have the help of a real estate agent or broker when transferring a property. These professionals are trained to offer a smooth buying or selling experience. In addition to providing you with the right advice to avoid problems in the future.