Which term describes the buyer's interest in a property between acceptance and closing?

Which term describes the buyer's interest in a property between acceptance and closing?

• A. Equitable Title
• B. Actual Title
• C. Earnest Money
• D. Legal Title

Answer: (A)

During the period after a purchase agreement is signed but before the closing, the buyer has an equitable title in the property. This means the buyer holds a real property interest that arises from the contract, giving them the right to obtain ownership and to enforce the contract, while the seller still retains legal title until the deed is delivered at closing. Legal title is the formal ownership recognized by law and is transferred only when the transaction closes. Earnest money is simply a deposit showing the buyer’s seriousness and does not describe the ongoing interest in the property. So the buyer’s interest during this interval is equitable title.

During the period after a purchase agreement is signed but before the closing, the buyer has an equitable title in the property. This means the buyer holds a real property interest that arises from the contract, giving them the right to obtain ownership and to enforce the contract, while the seller still retains legal title until the deed is delivered at closing. Legal title is the formal ownership recognized by law and is transferred only when the transaction closes. Earnest money is simply a deposit showing the buyer’s seriousness and does not describe the ongoing interest in the property. So the buyer’s interest during this interval is equitable title.