If you're seeing this message, it means we're having trouble loading external resources on our website.

If you're behind a web filter, please make sure that the domains *.kastatic.org and *.kasandbox.org are unblocked.

Main content
Current time:0:00Total duration:9:06

Video transcript

let's say that this is me in this column over here and that this is you and 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 so 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 well you possess 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 and 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 I 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 think well you know and what under what cases would possession not be equal to ownership well what if you just pick this Apple from your neighbor's garden the rightful owner of that Apple is your neighbor but you just picked it maybe you swipe this from the corner store maybe you found this on a bench and you said okay well doesn't seem an analysis claiming it so I'm just going to clean 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 differently 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 it was something that 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 whose garden the Apple came from or to see if 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 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 so 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 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 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 a hundred thousand dollars say okay yeah she 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 hundred thousand dollars so a little bit 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 and try to draw some keys here so keys to the house and you say just you know give me give me an hour and you pack up all 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 into 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 happened to be in it and had the keys to it didn't mean that they own 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 guests in the house and maybe the owners the real owners were off to work and in their faith their faces were the pictures just because they were the owners brother-in-law or something so maybe they were guests in the house maybe they were maybe they just saw a vacant house maybe this is someone else's vacation house and they 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 gonna pretend like I live there and then I'm gonna try to find somebody new to town and I'm going to sell them the house for $100,000 and if you think all of these things are kind of crazy scenarios they've all happened there because as you can imagine there's some people for whom who have who are I guess a little bit less scrupulous who have who have whose ethics are questionable who could be very tempted by this so you can 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 there 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 was closest closer to the previous owner of the house it said no no wait wait wait you can't give that house you to the the son-in-law I am I am the I am his younger brother or I am his long-lost child or whatever else it might be so the you might have thought that you owned the house but there might have been some other claim on it and maybe you bought the house outright or you thought you bought it but maybe the previous owner had you know that 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 in in modern societies that we deal with this where we see who has ownership rights or another way of thinking about it who has title so this is important word who has title or I guess you could say proof of title when I talk about title this is ownership right so we're talking about real estate is the right to live in the house it's the right to do what you you know garden around the house it's 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 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 find you would we would get a real get an attorney and then we would draft a deed that transfers that transfers the property from you to me but you're saying maybe that still doesn't you know prove to me that that the house is all good and then that's why I would do a title search on it so there is 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 it's things are done properly it needs to be made a public record it needs to be filed with the city or county and so when you do a title search so when you do just 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 DS they'll then look they'll look at the deed that that from the previous owner of the house to you they look at the the deed from from the previous owner even before that and they'll make sure that all of the the titles the 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 in the city still saying hey whoever owns this house owes us a thousand dollars 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 I have whoever is benefiting from this driver who owns this house they still owe 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'm going to make sure that you are the real owner of the property and only then will money be transferred