You own real estate. If you’re asked, how do you show proof of your ownership?
Essentially, the proof is in your property’s title history. This means:
- Your ownership interest is only as good as the interest conveyed to you by the last owner; and
- Others could have dibs on your property, if you used it to borrow money.
Of course, when you bought your home, the title company researched the chain of title to ensure previous owner had the right to convey to property to you. How do you check the chain of title now? The county keeps records. Many county websites make the information accessible online, so you can look up mortgages, other liens, and deeds that pertain to your property.
The Deed: Key Proof of Ownership
The general warranty deed is the standard instrument for home sales. Your notarized warranty deed is proof of ownership, and that the grantor transferred complete and clear title to you. A quitclaim deed also proves full land ownership—if the person who conveyed the interest to you had full ownership.
But where’s the deed? You received it at closing. If you’ve misplaced it you may purchase copies from the county clerk’s office.
Paid Off Your Mortgage? Prove It.
If a home has a mortgage lien, a mortgage note demonstrates that the borrower owns the property.
Now, say you want to refinance, and the underwriter wants proof you own the property, free of mortgage liens. If you’ve paid off your mortgage, you (and your county clerk’s office) got a satisfaction of mortgage letter a few weeks after payoff. This proves you own the property and that you paid off the loan. If any other liens surface in a title search, request statements of the lien settlements.
- Pro tip 1: Check your homeowner’s insurance declarations. Once your mortgage is paid off, no mortgagee clause shows up on your insurance policy. This can provide documentation to an underwriter that you own your property, free of mortgage liens.
- Pro tip 2: Another way to show an underwriter you have no mortgage is by producing a copy of Schedule E on your personal income tax returns. If it shows no interest deduction, this demonstrates you have no mortgage to declare.
Shoes to Fill: Becoming the Sole Owner
Some people want to be sure they have proof of ownership after their co-owing spouse or domestic partner has died. Often, the couple held rights to the property as joint tenants with right of survivorship (“JTWROS”). As the surviving spouse, you need the death certificate to remove the deceased co-owner from the title. File an affidavit of survivorship with the recorder’s office. This will place you in the records as the sole owner of the property.
Are you concerned that a specific, living person still have an ownership claim? Ask that person to fill out a quitclaim deed, by which they relinquish to you any rights they might have had, and file the deed, to ensure there is no cloud on title. Once the title is clear, a title company will be able to insure your title. This will be necessary of you are ready to refinance or sell.
A Chain Is Only as Strong…
If legal problems entered the process of transferring the title at any point, you might be concerned about the integrity of your home’s chain of title. Some problems are minor, such as typos or “scrivener’s errors.” These can be corrected without a need for a new deed, by way of a scrivener affidavit. But some are more serious, such as mistakes in the property’s legal description. Such errors require a correction deed to solve. Correction deeds state the error, and restate the legal description correctly.
A title search may turn up an old reference to an unrecorded document—perhaps a restriction, an easement, or some other agreement made by a prior owner. Some unrecorded documents expire. Nevertheless, the title search needs to take note, and underwriters need to be aware. If an unrecorded mortgage is haunting your property, but you didn’t know this when you bought the home, you’re a bona fide purchaser—not legally responsible for the unrecorded lien.
If there is a real debate about the title, a court might need to solve it in a quiet title action. A judge can examine any break in the chain, and declare that it no longer exists, enabling you to prove you have clear title to your home.
Just No Substitute for a Recorded Deed
A bill of sale, as a receipt for the purchase, is temporary proof of ownership. But don’t rely on it, or anything else, to substitute for the actual deed. The story of Matthew, a real Colorado resident, shows why.
Matthew bought a piece of land, filed the bill of sale with the county, and never gave it a second thought.
After Matthew had faithfully paid taxes and mortgage payments for a year and a half, the local assessor’s office returned the property into the seller’s name. Under Colorado law, the bill of sale doesn’t transfer property. Colorado requires the deed to be delivered to the buyer for a valid conveyance. Unable to find the seller and have a deed completed and recorded, Matthew had to file a quiet title action.
The moral of the story? Avoid a Matthew problem. When you buy property, be sure it’s a deed (indeed!) that’s delivered and recorded.
A Word to the Wise
Just because a document is filed with the county, doesn’t mean it’s right. This point is vital to the chain of title and your ownership status. When the county records a document, it does not provide legal advice. Nor does it review its recorded documents for mistakes, fraud, or illegality.
If you need to check the status of your title, you can set up an account to do a title search with us. This enables deed retrieval of the current grant, warranty, or quitclaim deed for your home.