Titles and deeds in real estate | Housing | Finance & Capital Markets | Khan Academy

Titles and deeds in real estate | Housing | Finance & Capital Markets | Khan Academy

– [Voiceover] Let’s say that this is me in this column over here, and that this is you in
that column over there. And let’s say that you are in possession of a nice juicy, of a nice
juicy apple right over here. Let me draw this apple properly, let me make the leaf in green. So you are in possession of this apple, and I’m hungry, I would
like to have an apple. And I just assume while
you posses this apple, I assume that you own it, so I go up to you and say, “Hey, can I buy this apple from you?” And you say, “Okay, yeah.
I don’t really need it, “I’ll sell it to you for a dollar.” And so I give you a dollar, I give you one dollar, and
then you give me the apple. Then you give me the
apple, so now I have it, so now I have the apple. Somehow the apple got smooshed a little bit in the transaction. So now I have, I have,
now I have the apple. Now when I did that transaction, there were some
assumptions that were made, I assumed that possession of the apple was equivalent to ownership of the apple. I assumed, whoops, I assumed possession is equal to ownership. And you might be thinking, “Wait, wait, “under what cases would possession “not be equal to ownership?” Well what if you just picked this apple from your neighbors garden? The rightful owner of that
apple is your neighbor, but you just picked it, maybe you swiped this
from the corner store. Maybe you found this on a bench and you said, “Okay, well it doesn’t seem “anyone else is claiming it. “So I’m just going to claim this apple.” But maybe someone else
had left it on the bench, and then they come back an hour later, said, “What happened to my apple? “I’m the owner of that apple.” So you see that even in
the case of an apple, possession might not
be equal to ownership. So these two things
might not be equivalent. But for something as small as an apple as, I guess you could say financially not as important,
something that’s you know has a market value of a dollar. It might be too much trouble to kind of do a background check on the apple to see do a forensic analysis to see who is guarding the apple came from or to see is someone else had legal right, legal title to the apple. And so for things like apples, we tend to just transact just assuming that possession equals ownership. Now let’s take, let’s up
the stakes a little bit. Instead of an apple, let’s say we’re talking about a house. So let’s say that you are in possession of this nice yellow house. So let me draw, we
definitely want to visualize what a nice yellow house would look like. It’s got some windows here, so and there’s some nice gardening. There’s, so you, you are in possession of this nice house. So what does possession
of the house means? Well, it means you’re living in it, you have the keys to the house, your station wagon is in the driveway. Your stuff is in the
closet, your furniture. You have pictures of you
and your family on the wall. So you seem to be in
possession of this house. And you stick a for sale sign out on. So, for sale. So you put a for sale sign
outside of this house, and I’m new to town, and I need a place for me and my family to live. And so I say, “Hey, you know, “I’d like to buy that house. “How much is it?” And you say, “It’s $100,000.” You say, “Okay, it seems like a reasonably “good deal compared to other houses “in this neighborhood. “I want to buy it.” And you say, “Great.” So I walk up to you, I write a check for maybe I even have cash for a $100,000. So a little bit more serious transaction than the apple transaction. And then in exchange you give me the keys to the house. So now I have the keys to the house. I’ll draw some keys here. So keys to the house. And you say, “Give me an hour.” And you pack up all of your stuff, take your pictures off the wall, put them in your station
wagon, and you leave. And you say, “Okay well, I guess I’m just “going to move in to the house.” Now, you probably are thinking, “Something is suspicious here. “Something is, makes us feel
a little less comfortable “doing this transaction than this “transaction over here.” Because this house,
just because the person happen to be in it and had the keys to it, didn’t mean that they owned the house. So once again, possession
does not necessarily equal ownership. We can think of a lot
of scenarios for a house where possession does not equal ownership. They might have been renting the house, they might have been renting. They might have been guest in the house. And maybe the owners, the real owners were off to work and their
faces were in the pictures just because they were
the owner’s brother-in-law or something. So maybe they were guest in the house. Maybe they were, maybe they just saw a vacant house, maybe this is someone
else’s vacation house, and said, “Hey you know what, “I know these people don’t show up “during the summer, so
I’m just going to go there “change the locks, have the keys, “and I’m going to pretend
like I live there. “And then I’m going to
try and find somebody “new to town and I’m going
to sell them the house “for a $100,000.” And if you think all of these things are kind of crazy scenarios, they’ve all happened. Because as you can imagine there’s some people for whom who have who are I guess a little
bit less scrupulous, who’s ethics are questionable, who could be very tempted by this. So you could imagine for,
when you’re talking about big dollar figures, people have tried some fairly major scams. So how do you, and you
know, and once again, just in the case of the apple, maybe someone left it on the bench, and someone thought that it was their, you know you thought it was your apple now that you found it. There could be, it doesn’t
have to be just scamming, it could be, I thought
I inherited this house, but then some other relatives shows up, who is closer to the
previous owner of the house, and said, “No, no, wait, wait, wait. “You can give that
house to the son-in-law. “I am his younger brother or
I am his long lost child.” Or whatever else it might be. So you might have thought
that you own the house, but there might have been
some other claim on it. And maybe you bought the house out right or you thought you bought it, but maybe the previous owner had you know was in a dispute with their
brother or their sister over the house. So there could be other claims on it. And so the way that, the
way in modern society is that we deal with this, where we see who has ownership rights or another ways of thinking about it, who has title? So this is an important word. Who has title? Or I guess you could say proof of title. When I talk about title, this is ownership rights, we’re talking about real,
right to live in the house, it’s a right to do what you, you know, garden around the house, has the right to modify the house. So the question of who has
title or evidence of title, evidence of title, happens
through legal documents. Evidence of title. And these legal documents
are called deeds. So let me write them. So the legal type. These legal documents are called deeds. And deeds, so when I,
so if I wanted to buy this house from you, you would, we would get an attorney, and then we would draft
a deed that transfers, that transfers the
property from you to me. But you’re saying, “Wait, wait, wait, “that still doesn’t you know prove to me “that the house is all good.” And then that’s why I would
do a title search on it. So there’s actually companies
that do title searches, and they’re going to go
to the public records, to the city or county records, and they’re going to
see, “Hey, what are all “the deeds that have been
filed with the city?” And whenever there’s a deed, if things have done properly, it needs to be made of public record, it needs to be filed
with the city or county. And so when you do a title search. So when you do, let’s
do in a different color. When you do a title search, whoever is doing the title search will look at the public records, and they’ll look at
all the previous deeds. They’ll look at the deed
that from the previous owner of the house to you,
they’ll look at the deed from the previous owner even before that, and they’ll make sure that all of the the titles, the title
transfer has been cleaned, that there hasn’t been any
weird claims on the house, that there haven’t been
liens on the house. We’ll talk more about what a lien is. A lien is essentially
a claim on the house, maybe three owners ago someone didn’t pay property taxes, and the
city is still saying, “Hey, whoever owns this
house, owns us a $1000.” Maybe four owners ago there was someone who did an improvement to the house, and said, “Hey, that owner never paid me “for the new driveway. “I have a lien on this house. “Whoever is benefiting from this driveway, “who owns this house,
they still own me money “before I were to remove that lien.” So the way that we do it
in a modern society is, Okay, you say you’re selling this house, but before I actually give you the money, I’m going to do a title search, I’m going to make sure that there aren’t any other claims, I want to make sure that you are the real
owner of the property. And only then will money be transferred.

22 thoughts on “Titles and deeds in real estate | Housing | Finance & Capital Markets | Khan Academy

  1. If someone leaves an apple on the bench and walks away they have abandoned that property. Abandoned property can be homesteaded. If abandoned property couldnt be homesteaded it could create a serious problem. When property owners died without creating a will their property would become off limits to everyone on earth for the rest of time. Eventually the earth would run out of habitable land :P.

  2. This clip is painful. He rambles on and could have said everything in 2 vs. 9 min.

  3. Yes this video is painful to watch. Rambling on and on. Just get to the point quick!

  4. I'm a visual learner, and this is just perfect =) Thank you so much for taking the time to explain =)

  5. this is perfect to me! I'm a visual learner as well and it was very useful!

  6. it is painful to watch indeed…so much bs…waste of time. The guy need to be a painter not a teacher lol

  7. The fact that you took the time out to create this video for others with questions and concerns is very kind of you. I appreciate this and so does others. Thank you and God bless you.

  8. A lot of unnecessary waffle, appreciate the visual aid but a lot of noise in this presentation could have been reduced to half the time.

  9. I liked this video, don't know what everyone else is talking about , very clear

  10. This was VERY helpful. Thank you. It’s taken me 5 hard years to gather the pieces to this Deceptive puzzle and comprehend what’s REALLY going on here. The Title companies are wrongfully withholding the Titles thanks to these Temple BAR ATTORNEYS and the Banksters!! WOW…!! There is NO end to this parasitic rabbit hole!

  11. The warranties is the security.

  12. This is perfectly explained. Thank you very much for the detailed explanation; very clear. Well done.

  13. Video was great!! For these Haters: He is a Human, not a Robot. Those that are bothered by the Human touch should turn on a stove and touch the burner.

  14. Best video for somebody who needs to learn A-Z about title search.

  15. Skip 6:35

  16. If anyone is interested in receiving help with the quiet title Please feel free to give us a call, at area code 561-951-4862. Monday through Friday. Also may text us anytime.

  17. took way too long to get to the point…

  18. Deeds are not titles. They are records of conveyance, a recording of an event. Who owns the land owns the property built onto. Citizens are not allowed to own land because their state abolished the land titles. So we are once again in a feudal society. And you thought you were free!


  20. bravo and half, thank you!

  21. Sal knows everything!

  22. Prepagent said that a deed is evidence of transfer of title…not the title itself ..this is so confusing

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