A house title is an important component of property ownership, establishing you as the owner. The title refers to the bundle of rights associated with property ownership. Homebuyers should ensure they understand the title process and how it can affect their legal rights to a property.
What Is a House Title: What Homebuyers Should Know
Buying a house is far more than just getting the keys and moving in. Owning a home isn’t just valuable for having a place to live; it’s also about the investment that property ownership represents.
As a homeowner, you receive a bundle of rights to the property. These rights give you key controls over the property. While some rights can vary depending on the area and legal contracts, there are five main rights the property owner who holds the title receives.
Right Of Possession: This means that you are the legal owner of the property.
Right Of Control: As the buyer, you decide how the property is used.
Right Of Exclusion: The property owner has the right to keep others off the property.
Right of Enjoyment: The owner can use the property in any legal way they choose.
Right of Disposition: The buyer can sell the property whenever they wish. They can also leave it to someone in a will or transfer it in another way.
What Is A House Title?
Land ownership is often described as holding title to it. It is not a physical document; instead, it is a chain of ownership. These rights are transferred to the new owner when a property transaction occurs.
These rights may also come with some restrictions. While you can use the property the way you want, depending on the community and local zoning, you may be unable to build additional units or rent out the property.
Any property is subject to local, state and federal laws, as well as any additional rules set by the community. If your property is in a condominium or a homeowner’s association, there may be additional regulations you must follow. While you have the right of exclusion, others may need to enter the home if there is an issue like a gas leak or a legal concern.
These rights can also be broken up individually. For example, while you have the right of disposition, if you have a mortgage, you must first satisfy the mortgage terms before the property title can be transferred.
What Does a House Title Look Like?
The bundle of rights is a broad framework under the house title. A house title is not signed or filed; it’s not a single piece of paper. However, evidence of title appears in property records.
What Is an Abstract of Title?
An abstract of title refers to the record of the property’s ownership. It shows all of the legal actions connected to the property, including all the times the property was transferred through sale, inheritance or other activities. It will also reveal if there are any liens on the property or any back taxes. The term abstract means an overview of the property’s history. If issues are spotted or questions arise, you may need to do additional research.
What Is A Title Search?
A title search is a thorough investigation usually conducted to determine the chain of ownership and verify whether the property title is clean. A clean or clear title means that the title can be transferred without any questions. During this process, any encumbrances, liens or claims against the property will be discovered.
The title search may reveal what are sometimes known as clouds on a title. A cloud is an irregularity or defect in the title. Some examples of a cloud on a title include an heir’s claim to the property, an unpaid lien or back taxes. If a cloud on title is discovered, it needs to be resolved before the title can be transferred.
What Is Title Insurance?
Title insurance is often bundled with the homebuying process. Title insurance protects you from any potential claims against your homeownership. While rare, a title dispute could cause you to lose ownership of a home. For example, if an undiscovered heir had a claim to the property, they could eventually come forward and challenge your ownership.
There are two types of title insurance: lender’s title insurance and owner’s title insurance. The lender’s insurance protects the lender for the value of the loan.
Why Is The House Title Important?
A house title determines the ownership of the home and establishes the owner's rights. Not having a clear title to the home may mean that some of those rights are compromised. If there is an issue with the house title, you will need to resolve it to fully possess the property.
Resolution of a title dispute often depends on the specific circumstances and the strength of the legal claims. It is advisable to consult a real estate attorney to navigate such disputes. This can be complicated and expensive, which is why title insurance is usually a good idea when purchasing a home.
The Difference Between A House Title Vs. A Deed
The title to a house is a concept and a chain of ownership. A house deed is a document that transfers ownership from one party to another. The mortgage is different from the deed. The mortgage deed includes details of who is responsible for the loan and its payment. The house deed indicates who owns the home. A person can be on the mortgage but not on the deed or on the deed but not on the mortgage.
The title and deed are closely connected. The title is the overarching ownership of the property and the deed is the physical proof. Deeds are often used as proof of ownership to establish a house title.
Why Having A House Title Matters
Without a clear house title, you may not fully own your property. This serious issue could cost you money or even cause you to lose your home. The house title makes it clear that you are the owner of the property and gives you the rights to possess it, sell it or use it in the way you prefer.
Conclusion
A house title is a key part of becoming a homeowner. It’s important to understand how title impacts the ownership of your home. Your real estate agent can help walk you through the details of how title works and guide you through obtaining title insurance. While it may sound complicated, title simply ensures you can enjoy your home freely for years to come.
Frequently Asked Questions
How can I check if a house title is clear?
You can visit your local property records office or check if the records are available online. Ensure the correct owner is listed and the property is free from liens and encumbrances.
How can I verify a house title?
You can either do a title search yourself or hire a company to do it. If you are doing it yourself, research all property records, including tax documentation and any liens on the property.
What happens if there is a dispute over the house title?
If there is a dispute over the house title, the parties may need to go to court to resolve the issue. Usually, before that, the parties will review the documents. If a resolution cannot be reached, the parties will go to court to seek a quiet title action, a legal proceeding to determine the ownership of the property.