Many people — myself included — use the terms “title” and “property deed” interchangeably. As it turns out, many people are wrong! Titles and property deeds are two distinct legal concepts, and mixing them up, while commonplace, can cause confusion.

In sum, the title is a concept only, while the deed is a physical document. Let’s look at them in-depth to understand the nuances of and difference between these two important real estate terms.

What are titles?

Titles refer to the ownership of the property and your rights to use it. Titles can be for sole ownership or partial ownership of a property. Property owners — with the title to prove it — can modify properties or even transfer the title or a portion of it to others.

Titles refer to the ownership of the property and your rights to use it.

How do you know that a title is valid?

In most real estate transactions, title companies will play an important role. Title companies review the title in question to look for any liens or easements (someone’s right to use a property without owning it).

Real estate titles have several elements to consider, including concepts like water rights, mineral rights, tenancy, timber rights, hunting rights, and even air rights. In a real estate transaction, the title company can explain the specific rights that come with a title.

In order to make sure your title is valid, the title company will conduct a thorough search of property records to make sure the person selling the home to you legally owns the property and thus can legally transfer it to you.

Title companies will also look for any outstanding mortgages, unpaid taxes, judgments or leases associated with the property

In addition to liens and easements, title companies will also look for any outstanding mortgages, unpaid taxes, judgments or leases associated with the property. In some cases, a title company might survey the property to determine its boundaries and to encroachments on the property by neighbors.

Do I need title insurance?

Title insurance usually comes with the territory for real estate transactions. If a title company’s search of the property turns up clean and you’re able to be issued the title, the title company will usually issue a title insurance policy as well. This is designed to protect owners (or lenders) against any potential disputes over property ownership.

For example, if someone sues you saying they have a claim against the home before you purchased it, title insurance would protect you and/or your lender. According to the Consumer Financial Protection Bureau, or CFPB, “common claims come from a previous owner’s failure to pay taxes, or from contractors who say they were not paid for work done on the home before you purchased it.”

If you used a lender to purchase your home, you were likely required to purchase title insurance for the lender at closing. However, according to the CFPB, you may want to consider purchasing an additional owner’s insurance policy for the title to protect your financial interest in the home.

The CFPB notes that “if you choose to buy owner’s title insurance, the total cost will usually be lower if you use the same provider for both the lender’s policy and the owner’s policy, compared to buying them separately.”

What are property deeds?

Whereas a title refers to the concept of ownership, property deeds are the physical, legal, written documents that transfer a title from one person to another.

Deeds and titles are definitely related—but they’re not the same thing. Whereas a title refers to the concept of ownership, property deeds are the physical, legal, written documents that transfer a title from one person to another. While deeds need to be recorded in your local courthouse, a failure to file, according to Rocket Lawyer, doesn’t mean you won’t own the property. You’ll still own the title, even if the courthouse hasn’t filed the deed. 

What if I lost my property deed?

When you purchase a home, you receive an awful lot of paperwork. Of course, you should plan to keep all this in a safe place, but sometimes you can lose documents. It happens. If you do, know that even if you lose the property deed, you still own the title. 

Losing the property deed document is no reason to panic! However, it would be wise to request a copy (and keep it somewhere safe!) from your local courthouse. You can also request a copy from your mortgage lender.