As previously noted, a title and deed are similar in that they both reference property ownership; however, there are clear differences in the way these items look, their overall intent and the way they’re handled during the home-closing process.
Physical Appearance
The biggest difference between a title and deed is their form, or appearance. A title is a concept people use to discuss ownership of a home, but a deed is an actual physical document that proves ownership (or title).
Overall Intent
If someone has a house title, they’re considered the owner of the property and given what’s referred to as a bundle of rights, which include:
- Right of possession: This ensures that the title holder can possess, or own, the property.
- Right of control: This allows the title holder to use the property however they want, as long as they aren’t breaking the law.
- Right of exclusion: This ensures that the title holder can limit who’s allowed to enter the property.
- Right of disposition: This allows the title holder to sell, rent or transfer ownership of the property.
- Right of enjoyment: This ensures that the title holder can enjoy the property.
A deed, on the other hand, is the physical documentation that provides proof of any title transfers that occur.
How They’re Handled
The differences between a title and deed become clearer during the home-closing process when they’re both used.
After a title search is completed and it’s been verified that the current owner has the right to transfer the property, a settlement agent will prepare all necessary closing documents, including the deed, and schedule the closing. Both the seller and buyer will sign the deed, transferring the title and ownership of the property to the buyer.
