What is a House Title? (how you know you really own your house)

A title is an important part of buying a home, but it’s not something that homebuyers (and even homeowners) completely understand. 

If you plan on becoming a homeowner, the title transfer (and associated insurance) will be a part of the home buying process. 

Here’s what you need to know.

What is a house title? 

A house title describes all the legal rights that come with being a property owner. The biggest misconception about the title is that it’s a single document: it’s not. Rather, it’s a collection of rights - like the right to possess, the right to sell, and the right to enjoy. 

Although it’s colloquially called a “house title,” the correct term is simply “title.”

The title is important because it also establishes the chain of ownership. When a home is sold, a title company will conduct a search to ensure that the current property owner has the rights to sell the home - and that the new owner will own the home without any complications. 

An example of what can come up during a title search is a lien. A lien is a legal claim to assets. A lien can be filed against a property when the owner fails to pay for something, like property taxes. Once the lien is granted, it gives the lien holder a chance to collect money when the home goes up for sale - or even gives them the power to force a sale in order to collect the debt.

Why is a house title important?

The title establishes true ownership. When you’re buying a house for many thousands of dollars, you want to make sure that you own it outright. 

Say that a homeowner dies, and the house is supposed to go to their next of kin - but they're not notified and instead, it’s sold. Without a title search conducted, the new homeowner could lose the home if the heir shows up to claim their inheritance - because legally, the home is still theirs.

Homes are a valuable asset, and with anything valuable, there are often fraudsters looking for victims. Deed fraud exists, and title services shield you from buying a home from someone who doesn’t have the right to sell it. This happens more frequently with rental homes and vacation homes that have been vacant.

Title insurance

Title insurance is not the same as home insurance. In the unlikely event that a problem with the title remains undiscovered during the search, the insurance will protect you from financial loss for the duration of your mortgage.   

Lender title insurance will be required by your lender (and protects the lender), while owner title insurance is optional and protects the homebuyer. It's highly recommended that you opt in to owner title insurance.

Common problems with title

You might be wondering: exactly what can go wrong with title? It’s actually fairly normal for a title issue to come up on a property, especially due to mortgages. A mortgage shows up as a property lien that can be removed once the debt is paid.

Common issues with the title:

• Unclear boundaries (with neighbors, public entities, etc)
• Liens (unpaid taxes or debt)
• Errors with public record (clerical errors, etc)
• Illegal deeds (if the title was procured illegally)
• Missing heirs

“The common issue that comes up with title would be liens - people not knowing that there’s a lien on their property," explains JoAnne Gratten, Title Manager at Houwzer. "For example: there are construction liens that are put on property because someone didn’t pay the contractor, and the owner thinks it’ll just go away - but actually, the contractor has the right to put a lien on the property.”

Part of what a title team does is help resolve the issues that arise with title, so that the homebuyer can successfully close on their home.

What is the difference between title and deed?

Many people confuse the house title with the house deed. A title is contractual; the deed is the physical document that you sign to transfer ownership of the property from one owner to another. 

When you buy the house and sign the deed, the title has been transferred and the house has been deeded to you. It then has to be filed with the appropriate local government office. 

Basically, the deed is the piece of paper that shows you have the title to your property.

When do you receive the deed (title)?

You won't receive the deed until after you've purchased the house.

"Once the property’s closed and both buyer and seller execute all documents, they’ll issue a title policy, which is their insurance. Then the deed and the mortgage will get recorded. Once it’s recorded, it’s sent back to us with stamps showing it’s been recorded, and then those original documents are mailed from the recording office downtown to our office (at Houwzer), then they’re mailed directly to the buyer," explains JoAnne.

How to get the deed to your house

If you’re already a homeowner and wondering how to obtain a copy of your deed, you have a few options.

• You can use a website to obtain a copy, usually within minutes.
• You can visit your local government office and ask for a copy. Your local recorder’s office will likely be the right place to visit for your area. Some recorders also allow you to access your records online. A small fee of a few dollars is typical.
• A title company can pull this information for you.

Keep in mind, this is the step you take to find an existing deed - not alter or change it. For that you'll need a new deed completely.

How to change house title name

When you sign your home's deed, make sure you use your correct, legal name - otherwise there can be legal trouble.

"You should have your proper name. Your birth certificate, your driver’s license, they should always match," recommends JoAnne.

If you’re looking to add an additional name to your home’s title, it won’t be as easy as going to a government agency and filling out a form. Instead, you’ll need to consult a title company or real estate attorney and ask them to prepare a new deed. Each state can have a different process for this, so you should consult your local government office - the one that has the deed on file - in order to figure out your next step. 

In Pennsylvania, for example, you’ll need to prepare and record a new deed in order to make a change. Although it’s not required, it’s advised that a certified professional (like a lawyer or Realtor) should prepare the deed. 

Keep in mind that if you’re adding someone to the deed who isn’t related to you (like a spouse, child, brother-in-law, etc), you’ll need to pay the transfer tax (2% of the property’s value!).

How to add spouse to title… and should you?

Keep in mind that the names on the property’s title are not the same thing as the names on the mortgage - so you can change one without changing the other. The deed refers to legal rights to the property - the mortgage is the legal obligation to repay the lender. 

If you’re on the title but not the mortgage, you share ownership of the home but aren’t legally responsible for paying for it. If you’re on the mortgage but not the title, the reverse is true. 

So for ownership purposes, it’s more important to be on the deed than the mortgage.

However, when it comes to marriage specifically, don’t rely on the title to spell out who owns what. Depending on what state you live in, the house might be considered owned by both spouses - regardless who’s on the title. 

“When you get married, don’t assume that because you didn’t put their name on the deed, that they're not getting anything. At the end of the day there are laws behind it. People should ask questions understanding whose name they’re putting on there, and what that means,” warns JoAnne. 

How are Houwzer’s title services different?

It's no surprise that home buying is so stressful: there's a lot on the line, including many hard-earned thousands of dollars. 

To cut down on chaos, Houwzer’s brought buying, mortgage and title all under one roof. Everyone is working on one team, ensuring clear and quick communication. You won't be stuck forwarding emails from your title company to your mortgage lender on a Saturday morning because someone else dropped the ball. The process is backed by a team of transaction coordinators who make sure i's are dotted and t's are crossed, and homebuyers can track the progress of their home in Houwzer's proprietary dashboard. 

"When you're dealing with a title company that doesn't have agents and mortgage lenders in house, they’ll tell you to call this person, that person - you’re calling 80 different numbers, whereas when you call us, if they used our lender, and our agent, we’ll handle it and get back to you," notes JoAnne. "We’ll handle the issue by calling our own mortgage contact - because we’re also Houwzer. We’re always available to help."

Ready to explore your options for buying a home - the less complicated way?