When it comes to property ownership, people sometimes use the words title and deed as if they are interchangeable. They certainly understand that these words refer to who holds the rights of ownership for that home, but the truth is that there are some significant differences between the two. They are not interchangeable terms, and it’s important to know that as you move toward a transaction.
First and foremost, the deed is the document that you sign. This proves that you own the home, and it is a physical document that can be held in your hand. If you need proof of who owns a piece of property, this is the clearest type of proof that you can have.
On the other hand, a title is more of a legal concept. The deed grants you the title to that home. This is why title issues come up, for example, when two people claim that they both own the same property. This can sometimes happen with mortgage scams where the mortgage is unknowingly purchased and sold to another individual. But the title is just that concept of ownership, and this concept is applied to the person who is named on the deed.
When are you given the deed?
Generally, when you buy a home, you have to go to closing with the previous owners. Real estate agents and even lenders will also sometimes attend. You sign numerous papers and a copy of the deed will be given to you as closing concludes. This is also the time when you will often be given the keys to the home and you take over ownership right at that moment, so you could directly go to the home and legally begin living there the same day.
There are some cases in which ownership will be delayed. For instance, the seller may have an agreement with you to transfer that ownership in two months, after they have had time to buy a new home. But most people take over ownership almost immediately after closing.
If you’re buying your first home, you can see how important it is to understand all of the terms and legal options that you have as you move through this process.