Clear title is a title free of claims, doubts, or disputes about ownership. These claims, doubts, or disputes about ownership can arise from liens or encumbrances. Clear title is free from material defects and is necessary before property can be sold. Typically, title searches are conducted to see whether the property has clear title as a search of the local public land records should reveal any easements, mortgages, or other encumbrances. When a title has material defects, it is said to have a cloud on the title.
In majority of states, a clearly established title by adverse possession is considered to have clear title.
Many states such as California and North Carolina have enacted Marketable Title Acts, which statutorily removed title defects of ancient origin by limiting the enforcement of rights preceding the statutory time period or by a showing of a chain of title for a specific period of time.
See also: marketable title, cloud on title, title search.
[Last updated in May of 2020 by the Wex Definitions Team]