Real Property Title

In the course of purchasing real property, such as a new home or commercial property, the title of the property is an important issue in the transaction. “Title” to real property involves a local public records office that keeps records of property ownership, and any potential restrictions or liens on a property. The title to real property shows who has legal ownership of the property.

Transferring title to property will often involve a deed, which is a legal document that transfers ownership, or a partial interest, in real property. Typically, the deed will include “covenants” (e.g. binding agreements or requirements) that define the transfer of property ownership. For instance, if there is a mortgage tied to a property, details related to the mortgage will be included in the deed. Such details include the mortgage creditor, the amount of the mortgage, and the type of the mortgage. If there is a breach, by either party to the deed, of a condition within the deed, then the party who is victim to the breach may have the right to cancel the transfer of property and seek financial damages from the breaching party. A claim for financial damages will include considerations of lost profits, as well as, any loss to the value of the property.

Often, buyers will purchase title insurance to help protect against encumbrances (e.g. liens or restrictions) on real property. Title insurance companies investigate the title of real properties to ensure there are no such restrictions. For instance, if there is a judgment lien on a property, a title insurance company will be able to notify the buyer of this financial restriction. While an encumbrance cannot prevent the transfer of title of real property, it can affect the value of the property. As such, it is important for buyers to have clear awareness of potential encumbrances on property they are attempting to purchase. In the event that legal disputes arise related to the title of the property, parties to the transaction may seek legal remedies to protect their rights to property. For instance, a party to a real property transaction can bring a quiet title action to establish rightful ownership against other parties claiming an ownership right in the property. A quiet title action may also help resolve issues regarding actual and legal property boundaries in the event of a boundary dispute between neighbors.

A property owner may also bring a legal action for slander of title in the event that another party’s false or malicious actions damages title to the property and causes financial loss. Such slander can include wrongfully claiming title to a property, thereby causing unnecessary litigation to determine rightful ownership. Wrongful claims can include attempting to record title documents with the local recorder’s office to suggest ownership of real property.

Real property transactions face several requirements and legal implications that change based on the specific circumstances of each transaction. Indeed, these variations lead to further rights and responsibilities for both buyers and sellers. Accordingly, to protect your legal interests and ensure the successful and proper transfer of real property title, speak to an attorney with knowledge and experience in real property transactions and litigation.