House title: What you need to know

Property ownership is legally complex, and proving you own a house involves a lot more than just making a purchase and closing on the home. A house title spells out the legal rights you have as the owner of that property and how you’re allowed to use the property. It's important for both you and any future owners of your home to fully understand how to get the title of my house and the rights associated with it.

What is a house title?

House title is the term for all the legal rights surrounding the ownership and use of a residential property. The title isn’t a document; it’s a legal concept made up of a bundle of rights.

Your bundle of rights encompasses all of the rights that come with being a property owner. Collectively, it means you have the right to:

• Possession. This right establishes legal ownership and gives the owner authority over the property, including the right to physically occupy and control it.
• Control. This means the right to use the property as you wish, within the law.
• Enjoyment. With this right, the owner can use the property peacefully and lawfully without interference.
• Exclusion. This grants the ability to restrict or deny access to others.
• Disposition. This permits the owner to convey, sell, transfer, or lease the property, or pass it on to heirs.

These property rights may be limited by laws, zoning, easements, liens on the property, or homeowners association (HOA) rules.

House title vs. deed

Again, the house title is not a document. It refers to the legal ownership of a property. If you hold title to a property, you own that property.

A property deed, or house deed, is a legal document that officially transfers ownership of the property from the previous owner to the new one.

When you buy a house, the seller – also known as the grantor – will sign the document, deeding the house to you, the grantee. The deed will then be filed with the appropriate government office for your county, such as the clerk or the register of deeds.

Essentially, the deed is the physical document that proves you hold the title to your home.

Why is the house title so important?

You might think that the person selling the home legally owns it and that you'll be the legal owner when they sell it to you. But it’s not always that simple.

The house title identifies the legal owner of a property and details any legal restrictions on its use.

The chain of title is the history of ownership of a home. When a house is being sold, a title company will review that history to ensure that the seller has the legal right to sell the home. It also will confirm that the buyer can take possession without any encumbrances that could jeopardize their ownership or cost a lot of money to remedy.

A title with no disputes is called a clear title. “A clear title ensures ownership rights of the owner and avoids claims of lenders, heirs, or taxing authorities who may claim ownership,” says Chad Silver, an attorney based in Southfield, Michigan.

If more than one person claims ownership of a property, they can file a quiet title action. This is a court process that resolves title problems or disputes, such as unpaid taxes or liens, to clarify who legally owns the property.

What are common ways to hold a house title?

There are several ways you can hold title to a property, which affect how ownership interests are divided and who can inherit them when an owner dies.

Sole ownership

This is a single person owning a property. It's most often used by single homeowners, and there are several reasons for a married person to get a mortgage without their spouse.

When a sole owner dies, their will decides who inherits the property. Lacking a will, the home would be transferred according to state law.

Joint tenancy

Joint tenancy allows two or more people to share an equal ownership interest in a property.

When co-owners hold title this way, they’re granted right of survivorship. This means that when one owner dies, their ownership interest automatically transfers to the remaining owner or owners without going through probate.

For example, if a married couple owns their home jointly, the wife would automatically assume sole ownership of the house upon her husband's death.

Depending on the law in your state, one joint tenant may be able to unilaterally sever the joint tenancy agreement and convert it to a tenancy in common.

“Couples or partners, instead of beneficiaries, often tend to select joint tenancy for the automatic transfer of ownership upon the death of one of the partners. The result is that you can’t will a particular share to someone,” says Dennis Shirshikov, a professor of finance and economics at City University of New York/Queens College.

Tenancy in common

Tenancy in common allows two or more people to co-own a property, with ownership interests split up however they choose.

For example, one co-owner could hold a 75% interest in the property, while the other holds a 25% interest. However, all co-owners have an equal right to possess the entire property. This type of ownership is common among unmarried couples.

Under a tenancy in common, each owner has the right to sell, give away, or otherwise dispose of their ownership interest as they wish. This includes the right to will it to whomever they choose. Tenancy in common doesn’t include the right of survivorship.

Tenancy by entirety

This type of ownership is only available to married couples and isn't an option in every state. Under tenancy by entirety, a married couple is treated as a single legal entity for property ownership purposes.

“The property is held as one legal unit between the two spouses, with the right of survivorship,” Silver says. Because each spouse needs the other’s permission before they can sell, transfer, or encumber the property or their interest in it, this shelters the house against some individual creditor claims. “Here, tax and estate transfers are not complicated, and the title disappears in case of a divorce between the couple.”

Community property

Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin are what’s known as community property states. In these states, any property obtained by one spouse during a marriage is considered to belong equally to both spouses.

When it comes to homeownership, this means that both spouses hold title on the home as community property. Depending on individual state laws, this type of ownership may or may not include right of survivorship. Without the right of survivorship, both spouses are free to will their share in the property to whomever they choose.

“With community property, each spouse is entitled to 50% interest in the property that is obtained during marriage. A half can be passed by each spouse through a will, except where the title is drafted in terms of survivorship,” says Silver. “In states where it is allowed, couples can have a full step-up in basis at death, which would decrease the capital gains tax in case the surviving spouse sells the property.”

Living trust

Some homeowners may decide the best way to handle the ownership of their property is to put it into a living trust.

This type of ownership means that your property is held in a trust by you, for you – you’re both the trustee and the beneficiary. When you die, the assets in your trust will be distributed according to your instructions, without going through probate.

“A living trust is best for those planning for real estate transfer or avoiding probate. The main consequence is that control is governed by the trust document, creating both flexibility and formal requirements,” Shirshikov says.

It’s worth noting that when you initially close on the property or refinance it, many lenders, including Rocket Mortgage, will only lend to people and not legal entities. The property cannot be closed in a trust.

How to protect your house title

Doing your due diligence when buying a home to ensure the house title is clear can prevent major problems if previously unknown liens on the property or an unexpected legal claim of ownership emerge.

“Protecting legal ownership of real property generally involves three key measures: conducting a comprehensive title search, reviewing the preliminary title report in detail, and obtaining title insurance," says Armand Gjeka, a real estate agent in the Philadelphia area. "Each of these measures is aimed at identifying, clarifying, or insuring against defects in the chain of title.”

Conduct a title search

Ordering a professional title search before closing will usually uncover any issues and prevent the sale from moving forward until they are resolved.

“A title search involves a systematic review of public records, including prior deeds, recorded liens, tax assessments, easements, and court judgments affecting the property,” says Gjeka.

You can enlist a title search company or an attorney to search for liens, uncollected taxes, easements, or lender claims.

A title search usually is required by your lender and typically costs a few hundred dollars. It is one of several title fees you can expect to pay as part of your closing costs.

Review the preliminary title report

The preliminary title report outlines the title status. It identifies matters such as vested ownership, outstanding liens, easements, restrictions, and any requirements that must be satisfied before title can be insured.

“This document serves as the legal roadmap for understanding what rights transfer to the buyer and what limitations will remain with the property,” says Gjeka. “Failure to closely examine this report can result in unexpected restrictions or disputes after closing, as items recorded decades earlier may still be fully enforceable.”

Silver recommends reading the report line by line and ensuring that all owners, loans, and restrictions are documented. Check title-holding plans and ensure all outstanding liens are satisfied at the time of closing.

Buy title insurance

Your lender will likely require you to buy a lender’s title insurance policy, which protects them financially against claims against your home's title, including title theft.

As the buyer, you can purchase an owner’s title insurance policy to protect your interests. Without an owner’s policy, you're vulnerable to title threats. You may also want to buy a title endorsement, an add-on to a title insurance policy that provides additional protection.

The buyer typically pays for title insurance as part of their closing costs. However, it's customary for the seller to cover the buyer's title insurance policy costs.

How to make changes to your house title

There are several circumstances when updating a property title is necessary. Common scenarios include:

• Marriage and the addition of a spouse to the title
• Divorce and the removal of a spouse
• Implementation of estate-planning structures
• Adding heirs through a trust
• Changes to ownership made for asset-protection or tax-planning purposes
• Forming or dissolving investment partnerships.

“The legal process for modifying title follows a defined sequence,” says Gjeka. “A property owner first consults with a qualified estate-planning or real estate attorney to determine the appropriate ownership structure and ensure compliance with state law.”

This is also when the attorney recommends whether a quitclaim deed, a warranty deed, a deed of reconveyance, or an interspousal transfer deed is appropriate for the situation.

After execution, the deed is recorded with the county recorder or registrar of deeds, and any relevant tax, municipal, or homeowner association records are updated to reflect the change.

Any revised title should align with the owner's estate plan, particularly if children, blended families, or business partners have future legal rights to the property, Silver says.

The bottom line: Understand your home’s title to protect your ownership

When you buy a home, you want to ensure it doesn’t come with costly baggage. Understanding who truly owns your property and protecting yourself with title insurance can give you peace of mind and help you avoid a financially ruinous title disaster.

If you’re ready to buy a home, start your mortgage application with Rocket Mortgage.

Rocket Mortgage is a trademark of Rocket Mortgage, LLC or its affiliates.