DEFINITION of 'Bad Title'

A title that does not grant ownership to its holder due to unsatisfied legal or financial problems. A bad title is most often associated with real estate. Having a bad title can prevent the titleholder from selling the asset.

BREAKING DOWN 'Bad Title'

A bad title may exist for a variety of reasons. In the case of real estate, the title may have a lien associated with it, may have back taxes owed or may have failed to correct a building violation. Any problems associated with the title must be resolved before the titleholder can legally transfer the title to another party. If a bad title is transferred, the receiving party does not legally own the property.

Real estate investors should make sure that a property does not have a bad title before proceeding with any purchase. Homes in foreclosure, for example, may have a number of outstanding issues. Buyers may consider purchasing owner’s title insurance to protect themselves against unforeseen claims against the title.

RELATED TERMS
  1. Clear Title

    Also known as "clean title," "just title," "good title" and "free ...
  2. Quiet Title

    A lawsuit filed to establish ownership of real estate when ownership ...
  3. Perfect Title

    A title deed for real estate that does not have any liens attached ...
  4. Cloud On Title

    Any document, claim, unreleased lien or encumbrance that might ...
  5. Chain Of Title

    The official record of ownership of a property or asset. The ...
  6. Absolute Title

    Title to a property that is free of any encumbrances or deficiencies. ...
Related Articles
  1. Investing

    Holding Titles On Real Property

    Find out how best to claim and convey ownership on your assets.
  2. Personal Finance

    Getting A Car Title Loan

    This loan-of-last-resort uses your car as collateral and features very high interest rates and fees. Be extremely wary of even considering one.
  3. How to Sell a Car With a Lien

    Vehicle owners wondering how to sell a car with a lien on the certificate of title have four options to both remove the lien holder and transfer ownership.
  4. Personal Finance

    Car Title Loan Limits

    You can usually get 25% to 50% of a car's value - but could pay more in interest than you borrowed if the loan rolls over a lot before it's paid off.
  5. Personal Finance

    Title Loans vs. Payday Loans: Which Are Better?

    Both title loans and payday loans carry risks that outweigh the benefits.
  6. Investing

    Attention Home Buyers! Why You Need A Lawyer

    Property transactions are complex and subject to specific state/local rules. A professional can simplify the process.
  7. Personal Finance

    Are Car Title Loans Ever a Good Idea?

    Most people knowledgeable about finance consider title loans predatory. What would constitute a good-quality short-term loan? Here's one idea.
  8. Insurance

    Encumbrances And Nonpossessory Interests In Real Property

    Learn about nonpossessory interests and the various forms of encumbrances.
  9. Personal Finance

    8 Top Alternatives to Car Title Loans

    Before you sign up for a car title loan, investigate these 8 alternate strategies.
  10. Investing

    Who is a Beneficial Owner?

    A beneficial owner enjoys the benefits of owning an asset even though its title is in another’s name.
RELATED FAQS
  1. What do real estate attorneys do?

    Understand the role of a real estate attorney to help you decide if you would benefit from the expertise of this type of ... Read Answer >>
  2. What type of work experience can count towards the work experience required in order ...

    CFA Institute provides a list of job titles that qualify for the work experience an individual must gain to be awarded with ... Read Answer >>
Hot Definitions
  1. Graduate Record Examination - GRE

    A standardized exam used to measure one's aptitude for abstract thinking in the areas of analytical writing, mathematics ...
  2. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
  3. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
  4. Cover Letter

    A written document submitted with a job application explaining the applicant's credentials and interest in the open position. ...
  5. 403(b) Plan

    A retirement plan for certain employees of public schools, tax-exempt organizations and certain ministers. Generally, retirement ...
  6. Master Of Business Administration - MBA

    A graduate degree achieved at a university or college that provides theoretical and practical training to help graduates ...
Trading Center