Cloud On Title (Cloud) Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Cloud On Title (Cloud), written in plain English, along with examples of how it is used.
What is Cloud On Title (Cloud)?
It refers to any form of claim which has been outstanding or any other obstacle like unclear deed of the property, debts not yet paid off or if paid, not yet recorded, legal issues not yet solved and such forms. Such clouds or uncertainties over the property does not allow a free transfer or sale of property in interst of any other person, till it is clear of such encumbrance.
History and Meaning of Cloud On Title (Cloud)
The term "cloud on title" or simply "cloud" has been used in real estate law for many years. It refers to any issue or problem with a property's title that makes it unclear or uncertain who the rightful owner is. Common examples of clouds include unpaid taxes, liens or mortgages, outstanding judgments or lawsuits, and other forms of encumbrances.
A cloud on title can create significant problems for the property owner, as it may prevent them from selling or transferring the property to another party. In some cases, it may even lead to legal disputes between multiple parties who claim ownership rights.
Examples of Cloud On Title (Cloud)
- John is trying to sell his house, but an outstanding mortgage lien from a previous owner creates a cloud on the title.
- A property owner discovers an easement on their land that was not disclosed in previous title reports, creating a cloud on the title.
- A property was inherited by three siblings but was never properly divided or transferred, resulting in a clouded title with multiple owners.
Legal Terms Similar to Cloud On Title (Cloud)
- Lien - A legal claim against a property for an outstanding debt or obligation.
- Encumbrance - Any burden on a property's title that limits the owner's ability to transfer or sell the property.
- Title Search - An examination of public records to determine the ownership history and any clouds on a property's title.