Land ownership should be a straightforward thing. When you find a piece of land for sale that’s within your budget and preferred location, all you have to do is make an offer, negotiate with the seller, and close the deal. If all goes well, the transfer of property should be a breeze.
However, when the buyer is purchasing property or land for the first time, they may not be familiar with the process, legalese, and documentation required. There can be confusion and miscommunication that may lead to problems in the future. It’s important to understand what is involved in owning real estate and transferring ownership to avoid hiccups. As the buyer, it’s also important to know these things and not rely solely on your agent.
The Title is Not the Deed
First things first. Let’s have some definitions of terms. A land title is your right to or ownership of a piece of land or property. It encompasses all the “elements constituting legal ownership,” as Merriam-Webster puts it. It means that when you hold the title to the entire property, you can use it and modify it as you see fit. You may either have the title to a portion of the property or the whole piece of land. What is essential to keep in mind is that you can use, modify, and transfer ownership only of that part of the land indicated in your title.
A property deed, on the other hand, is the signed and sealed document that indicates the transfer of title or the transfer of rights and ownership. It can be a deed of sale, deed of mortgage, deed of donation, and others. Without it, there’s no confirmation that a piece of real estate was transferred legally to the new titleholder.
Recording Your Deed and Title
Property lawyers estimate two weeks to three months from the closing of a sale to have your land title and deed ready. It should be registered in the right county or state. This is very important, especially if the parcel of land had changed hands multiple times or its ownership level has changed (i.e., a single owner of the land divided it and sold some portions to different people but retained the title to a parcel).
Recording a deed of sale or title transfer is also more critical than the title. Here’s why. Each state has what you call a recording statute that regulates the deeds and interests on a piece of property. The law identifies the order of priority given to certain interests. For instance, if a parcel of land is under a mortgage or lien, the law recognises whose claims should be paid off first when the land is sold. The government property office honours all activities surrounding real property on record, including the transfer of ownership.
This is why a deed must be registered. Without a deed of transfer or sale on record, you will not be recognised by the state as the current lawful owner of a piece of land, even if you hold the title. If your deed is not on record, the last owner named on the record will remain the owner as far as the state or county is concerned. If you think your land title agent has finished processing your title and deed, make sure to check them.
What Do Land Titles and Deeds Contain?
Land titles typically contain the full name of the titleholder or owner of the land, their civil status, nationality, residence address, and the full name of their spouse (if married). It also has a description of the land, annotations, and other important information.
Deeds identify the grantor (giver) and grantee (recipient) of the deed, description of the property, the right legal language indicating conveyance, and the signature of the grantor or grantors. The grantor must have the legal capacity to transfer the property, and the grantee must also be legally capable of receiving it. The deed is delivered to the grantee, and the grantee normally receives it. However, in case the grantee sees potential problems in the grant (this may happen when it’s a deed of donation), they may file a petition in court to void the deed.
In times when a deed of sale was executed and the title agent failed to follow through with the entire process (such as when property agencies closed shop during the pandemic), buyers must know what to do next. Understanding the process will help you determine your next move.