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- What Are Netting Escrows & How Does It Work?: The Best Guide - January 2, 2024
- The Secret About Prescriptive Easement: Top Guide 1 Must Know - December 4, 2023
- About Home Equity Loans In Texas And How Can One Obtain It - November 27, 2023
About Torrens System
Being a homeowner is not an easy task especially when you are surrounded by confusing real estate jargon.
Many real estate jargons are simple to understand, but some need more effort to understand. One such topic that we will discuss in today’s post is the Torrens system.
What Is A Torrens System?
A Torrens system, also known as a Certificate of Title, is a document that gives the registered owner undisputed ownership of real property.
The certificate acts as the ultimate authority on the ownership of the property, and its legal authority makes registration irrelevant.
This type of property law was first used in Australia in 1858 when Sir Robert Torrens from South
Australia began to correct the weaknesses in the registration system at the time. After the old system caused great losses in land grants, Torrens designed the new system, where the register of all the lands in the region recorded the transfer of rights and titles of different landowners.
Being legally registered, landowners have absolute and irrefutable rights to their property, preventing confusion about who owns the property and holds the title.
A quick search of the land registry can bring up the name of the legal owner of the property.
Naturally, land registration is a key element of the Torrens certificate. In this complete record, each property is assigned a number, and, in addition to the owner’s name, the portion of the property and its territory, as well as a record of all legal matters related to the property.
It is the responsibility of the registrar to maintain this list of properties and update any changes such as a change in ownership.
All the registrations were manually documented on paper; however, with the introduction of computers and technology, all the records are now maintained on a database system.
What Are Different Principles Of Torrens System?
There are three principles that the Torrens certificate is based on
1 - Mirror Principle
This principle indicates the current details of the title on the property. It will display the name of the current holder of the title and all other registered interests in the property like easements, liens, and mortgages. It will not display any zoning details on the title.
2 - Curtain Principle
The curtain principle means that the buyer does not need to search the previous titles and avoids a lengthy process. It will provide a certificate of title that acts as ownership proof.
3 - Insurance Principle
This principle guarantees the accuracy of the title registration. If there is any error made by the registrar while updating the title information, the title holder will receive the compensation required to get it corrected.
What Are The Pros And Cons Of Torrens System?
The Pros:
- Acceptance of titles in areas where there is complete supervision of the first transfer process.
- Compare to the title abstract, Torrens certificate of title is easier to work with.
- Registration disallows possession of property by adverse action against the registered owner.
The Cons:
- Accepted in limited states in the country.
- The cost of the process is higher initially.
- The system is complicated and time-consuming.
- Lack of qualified staff leads to inconsistency in records and other issues.
- There is a possibility of errors while recording by the registrar.
Conclusion
Though the Torrens system could be one of the efficient ways to update titles to the property, it is still not accepted by all the states in the country.
In the U.S. eleven counties use this system for updating titles on the property which are New York, Washington, Illinois, Georgia, Virginia, Massachusetts, North Carolina, Colorado, Minnesota, Hawaii, and Ohio.
If you are not sure about the system being used in your state, you can get in touch with your trusted real estate agent to know more about the Torrens certificate in detail.
