Free And Clear Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Free And Clear, written in plain English, along with examples of how it is used.
What is Free And Clear?
(adj) The phrase ‘Free and Clear’ is used to qualify a property which is free from all encumbrance, lien, claim or other legal charges. It is used to represent the clear title on the property in property transactions
History and Meaning of Free And Clear
The term "free and clear" has been in use in property law for many years, going back to the basic concept of ownership. In simple terms, it means that a property is free from any legal claims or encumbrances, and the owner has the legal right to sell, transfer, or use the property as they see fit, without any interference or claims from others. In a real estate transaction, the phrase "free and clear" typically refers to a property that is unencumbered by any liens, mortgages, or other legal claims that could affect the new buyer's ownership rights.
Examples of Free And Clear
When a homeowner pays off the last installment on their mortgage, they own their property free and clear. They are no longer required to make payments to the bank, and they have the right to sell or use the property as they wish.
In a real estate transaction, the seller typically wants to sell the property free and clear, meaning that there are no outstanding liens or mortgages that would need to be paid off by the buyer. This ensures a smooth transfer of ownership without any legal disputes.
A court ruling may grant someone the right to own a property free and clear of any present or future legal claims against it. This often occurs in cases where there was a dispute over ownership or a financial obligation, but the court has ruled in favor of one party, granting them free and clear ownership.
Legal terms similar to Free And Clear
Clear title - Similar to "free and clear," this term signifies that a property has a title that is unencumbered by any liens, mortgages, or other legal claims.
Unencumbered - This legal term means that a property is free from any liabilities or debts that could impact the legal ownership rights of the property.
Marketable title - A title that is deemed free from any legal defects or disputes that could affect the property's transfer of ownership.