When buying a property, at the stage where the transaction needs to be closed, there is a need for a title transfer. It is important to retain the services of a lawyer when transferring property ownership. At Rameh law, we will help you document the transaction correctly and work to ensure your rights are protected during the process.
What is a property title?
The word “title,” as used in real estate, is a way of saying you have legal rights to use a property. It may either be partial or full interest in the property. The title also gives you the power to transfer a portion or all of your ownership interests to other persons. You can’t transfer more than your own.
The related term to “title” is a property deed. A deed is an actual legal document that transfers ownership (title) of property from one party to another.
What is title transfer?
Title transfer means the change of real estate ownership from the seller to the buyer. A transfer of title involves removing or adding a person to the property title (or ownership) by the current owner. In places like Ontario, title transfers can only be facilitated by an attorney.
There’re scenarios where title transfer may be necessary. For example, during property refinancing, a financial institution may demand that the property owner adds or removes someone from the title to be eligible for a mortgage.
Property title transfer may also be necessary at the separation between spouses who jointly own a property.
For estate planning purposes, a property owner may also need to add or remove a family member or a spouse from the title.
Your rights as a title owner
A property owner who has a valid deed has a bundle of legal rights. These privileges are due to the title owner.
However, title rights may not be the same for everyone as some property agreements may limit or prohibit certain property uses. However, a common titleholder generally has rights that include the right of:
Possession- the right to own the property
Control- the right to manage and put the property to any use that the owner wishes
Enjoyment-the right to reap the benefits of owning the property
Exclusion-the right to prevent other persons from entering or using the property
Disposition-the right to please rent cell or permanently (or temporary) transfer ownership to other parties
Types of title
Freehold title is one that is “free from hold “of any party other than the property owner. A freehold titleholder is entitled to free ownership for perpetuity. It entitles the holder to use the property for any purpose but in accordance with the property laws and the local regulations.
If you are a freehold titleholder, you do not often need authorization by anyone to sell the property; thus, the process is swift and requires less paperwork.
While properties on freehold ownership are relatively more expensive, the appreciation in their value can compensate for it. Moreover, freehold titles give you more control of the property when you decide to sell it.
This type of arrangement allows you to buy a physical structure, which can be: a house, a condo, a townhouse, or a flat, while giving you the option to lease the land from another person. Generally, the landlord is a member of a First Nations group or the government.
Leasehold titles often have a validity period of 99 years. While it may seem a long period, persons wishing to own property on leasehold terms find such arrangements unattractive when nearing the end of the lease.
After the expiry of the lease, the property owner may decide not to renew it. Worse still, renew it, but at a higher price.
Typically properties with leasehold titles are hard to finance and don’t ordinarily appreciate over time.
Life estate ownership:
This type of title allows a property buyer to enjoy ownership rights for life. Legally the ownership rights to the property end upon the death of the buyer.
When the buyer dies, the original owner regains ownership or may transfer it to another party. A person with life ownership rights is called a “life tenant.” However, this type of title arrangement is rare nowadays.
Whether you are selling, refinancing, or buying a home, one of the critical professionals you will need to work with is a real estate attorney. Irrespective of the process you are undertaking, your attorney has the responsibility to ensure proper filing of paperwork, protect your rights, guidance, and ensure that the transaction goes through. Get in touch with us if you’re looking for a lawyer for title transfers.