Property Title
The legal concept of ownership rights to real estate, including the right to use, sell, and transfer the property, as evidenced by a deed and public records.
What is Property Title?
Property title refers to the legal concept of ownership—the bundle of rights associated with owning real estate, including the right to possess, use, control, exclude others from, and dispose of (sell, gift, or bequeath) the property. Title is evidenced by a deed and confirmed through public land records maintained by the county recorder or register of deeds. 'Holding title' means having legal ownership; 'clear title' (also called 'clean title') means ownership is undisputed and free from liens, encumbrances, or claims by other parties. Title can be held in several ways: sole ownership (one individual), joint tenancy with right of survivorship (two or more people with equal shares passing automatically to survivors), tenants in common (two or more with specified shares that pass by will or intestacy), or through entities (LLC, trust, corporation). Lenders require title insurance to protect against undiscovered defects—such as forged signatures in prior deeds, unknown heirs, or recording errors—that could cloud title and threaten the lender's or owner's interest.
Example
When a buyer closes on a home, the title company performs a title search, issues title insurance, and records the new deed—transferring clear title from seller to buyer. If a title search later reveals an undisclosed mechanic's lien from a contractor who worked on the property two years earlier, the owner's title insurance policy would defend the claim and pay the lien if valid, protecting the buyer's ownership interest at no additional cost.
Source: Consumer Financial Protection Bureau — Title Insurance