Ownership & Title Terms
Deed
The legal document that transfers ownership of real property from one party to another. The deed is what actually conveys title — signing a purchase agreement isn't enough on its own; the deed has to be signed and recorded.
Title
Your legal right to own and use a piece of property. "Clear title" means there are no competing claims, liens, or disputes over ownership — the goal of every title search.
Clear Title
Title that's free of liens, judgments, competing ownership claims, or other encumbrances. Most buyers (including us) require clear title, or a plan to clear it at closing, before a sale can close.
Easement
A legal right for someone else to use part of your land for a specific purpose — commonly a utility company running power lines, or a neighbor with a right to cross your land to reach their own property. An easement doesn't transfer ownership, but it does limit how you can use that portion of the land.
Right-of-Way
A specific type of easement that grants the legal right to pass through a property — most often to provide road access to a landlocked or hard-to-reach parcel. Confirming a documented, legal right-of-way (rather than informal, permission-based access) is critical before buying or selling land that doesn't directly front a public road.
Lien
A legal claim against a property that secures a debt — a tax lien for unpaid property taxes, a judgment lien from a lawsuit, or a mechanic's lien from unpaid contractor work are common examples. A lien doesn't prevent a sale, but it does get paid from the proceeds at closing before the seller sees any money. See our full breakdown in what happens if there's a lien on your land.
The Closing Process
Escrow
The holding period where a neutral third party (the title company) holds the buyer's funds and the transaction paperwork until every condition of the sale is satisfied. Once the title search comes back clean and the deed is signed, escrow "closes" and funds are released.
Title Company
A neutral third party that runs the title search, holds funds in escrow, prepares closing documents, and disburses money once the sale is complete. Using a licensed title company is what makes a land sale safe for both buyer and seller — neither side ever hands money or the deed directly to the other.
Closing
The final step of a real estate transaction, where the deed is signed and recorded, funds are disbursed, and ownership officially transfers. See our full walkthrough of what closing actually means when selling to a direct buyer.
Earnest Money
A deposit a buyer puts down to show they're serious about a purchase, usually held in escrow and credited toward the purchase price at closing. Terms vary by deal — some are refundable under certain conditions, others aren't.
Purchase Agreement
The signed contract between buyer and seller covering price, property description, and closing terms. Once both parties sign, the transaction typically moves into escrow.
Recording
Filing the deed with the county's official land records after closing, which makes the new ownership a matter of public record. Recording is usually handled by the title company as one of the final steps of closing.
Value & Tax Terms
Comparable Sales (Comps)
Recent sales of similar nearby parcels, used to estimate what a property is actually worth. See our guide on how to pull comparable sales yourself before evaluating any offer.
Fair Market Value
The price a property would sell for on the open market between a willing buyer and seller, neither under pressure to act. This is different from a direct-buyer cash offer, which trades some price for speed and certainty.
Cost Basis
Generally what you paid for a property, used to calculate capital gains tax when you sell. Inherited property usually gets a "stepped-up" basis instead — see our full capital gains tax guide for how this works.
Capital Gains
The taxable profit from selling a property — sale price minus cost basis and selling expenses. Taxed at different rates depending on how long you held the property before selling.
Property Tax Assessment
The county's official valuation of a property, used to calculate the annual property tax bill. Assessed value isn't always the same as fair market value, and rules for how it's calculated vary by state and county.
Ownership Transfer Terms
Probate
The court-supervised process that validates a will and transfers a deceased person's assets, including real property, to their heirs. See our full breakdown of selling inherited land, including what you can do while probate is still pending.
Stepped-Up Basis
When you inherit property, your cost basis usually "steps up" to the property's fair market value on the date the previous owner died — rather than what they originally paid. This can significantly reduce or eliminate capital gains tax on a sale.
Warranty Deed vs. Quitclaim Deed
A warranty deed guarantees the seller holds clear title and will defend against any future claims — the standard for most arm's-length sales. A quitclaim deed transfers whatever interest the seller has, with no guarantees about title — common between family members, but riskier for a buyer in an open-market sale.
Still Have Questions?
This covers the terms that come up most often when selling land, but every transaction has its own quirks. If something about your specific property doesn't fit neatly into any of this, tell us the details and we'll walk you through it — no obligation.