People often use the terms property deed and property title interchangeably. Although the two terms are connected, they are not one and the same. Property deed vs. title, here is how you need to look at the two when you sell your home.
In the first instance, when we talk about property title, we are referring to your legal ownership of a home. Property title is what gives you legal authority to use your property as you see fit, within the legal framework of course. Put another way, property title is a bundle of legal rights to a property. These rights get transferred from seller to buyer and include
The right of possession
When we refer to the right of possession, we simply mean that the property is yours and you own it.
The right of control
Your property is yours and therefore you have he legal right to use it as you please, as long as you do not break the law.
The right of exclusion
When you have control of the property you can determine who can access it.
The right of enjoyment
You can enjoy your property to your hearts content as long as you are operating within legal parameters.
The right of disposition
The right of disposition gives you the right to transfer the ownership of your property. However, you are not permitted to transfer ownership until you ‘clear title’. Clearing title simply alludes to the fact that you have proven your title of the property is free of any defects. Examples of defects include liens, judgements and bankruptcies. Prior to closing a real estate lawyer needs to conduct a title search to make sure there are aren’t any potential problems. If any issues are identified during the title search, they have to be cleared before the sale can move forward. Some issues that can forestall the sale include unpaid taxes, bankruptcy filings, boundary encroachments and improper title transfers.
A property deed is a physical document that conveys the title to the new owner when you sell your home. This document will include a description of the property. In addition, a property deed clearly identifies the seller and the buyer for a particular transaction. The buyer and seller will need to sign the deed to complete the real estate deal. At the time of sale, the buyer gets the physical document. The property deed proves that the buyer has legal title to the property. Here are a few types of deeds:
General warranty deed
To start with the general warranty deed is primarily used in traditional home sales. The general warranty deed provides comprehensive protections for people buying homes. Moreover, the general warranty deed means that you have ownership of the property and have clear title and a right to sell the property. In addition, the general warranty deed means that you have no knowledge of any unforeseen issues that might come up with the title.
Special warranty deed
A special warranty deed promises clear title for the time you have owned the property. In most instances, a special warranty deed is used in commercial real estate transactions. Hence it is also referred to as a covenant deed.
A grant deed shows that you have clear title to sell and no knowledge of anything that might impact the title. However, it does not include the warranty that you will defend the title against any claims after the sale takes place.