Every homeowner takes home protection seriously, but you might not think about the title itself as being part of the solution. It may be difficult to imagine, but owning your home doesn’t necessarily grant you all of the rights to that property. Both legal title and equitable title offer certain rights and benefits. The two are not interchangeable. Understanding the differences could be tremendously helpful, especially if you want to ensure that your home has all of the legal protections possible.

Equitable Title

An equitable title specifically refers to the enjoyment of the property. With phrasing like that, you might not think equitable title is terribly important, but it certainly is. With an equitable title, you have access to the property, and the right to regularly use and enjoy the property. This means someone with equitable title might have more readily available access to the property than the actual owner. As a result, this grants the equitable title holder more consistent control and possession over the property itself. As you can see, this could be incredibly valuable.

Having equitable title legally establishes a person’s financial interest in the property. This is why many real estate investors gain equitable title. It’s always recommended that you gain equitable title when purchasing a property. This grants you the right to eventually gain full ownership, and it gives you the ability to receive benefit from any appreciation in value. Obviously, this is why many investors favor equitable title. With both legal and equitable title, you could transfer ownership of the property to someone else and retain the difference due to appreciation.

Legal Title

Legal title is what most people think of when purchasing a home. With the legal title, you are the rightful owner. Your name will appear on the deed, and this provides you with a variety of rights to the property. With the legal title, you have mineral, easement, development, and conveyance rights. It also grants you the right of disposition. If you have the legal title, you should also have possession and control, as well as exclusive use. With this list, it’s easy to understand why many prospective homeowners may assume the legal title is all they need, but someone with equitable title could provide restrictions when it comes to use and enjoyment of the property, as noted previously. As a homeowner, it’s always best to have both the legal title and equitable title in your name.

man signing document

Differences and Distinctions

The legal title is the only one that gives you actual ownership of the property. Someone with equitable title is not considered the owner, and they do not have the right to sell or transfer ownership of the property. Both titles are legally binding, and they are both able to be enforced in a court of law. When it comes to a mortgage, the distinction isn’t always made. A bank will usually grant both titles via a deed of trust. This is why so many homeowners don’t know about the differences. They’ve never been presented with the details.

In order to have full ownership and control over your property, you require both the equitable title and legal title. As part of a comprehensive home protection plan, you should always ensure that you have these titles in your name. If you have any questions or concerns, you can speak with the experts at Secure Title Loan. They’re happy to answer your questions and help you begin to remedy any legal issues that may be uncovered. Protecting your home starts with protecting your rights.