What is the difference between legal title and equitable title?
Legal title and equitable title are terms found in inheritance law in Hawaii. Legal title is a term that refers to the ownership of property that is legally recognized by the state. It is established through a deed or other legal document that is registered with the state or county. This title means that the owner of the property is the sole owner and all rights to use the property or the resources associated with it are held exclusively by the owner. Equitable title is similar, but differs in certain ways. It is a term used in reference to a person’s moral or beneficial ownership of a property. It is based on an individual’s good faith effort to purchase or acquire a property, but not the legal recognition of ownership. The rights that are held under equitable title are not exclusive and are not recognized by the state as a legal ownership. While legal title makes the individual who holds it the sole owner of all resources and rights related to the property, equitable title does not give the same rights. Instead, it is an agreement between the buyer and the seller. It gives the rightful owner the right to ask for a court order to transfer the property to the buyer, but the buyer does not have exclusive use of the property until legal title is established.
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