What does it mean when a buyer has equitable title?

When a buyer has equitable title, it means that the buyer possesses a legal right to obtain full ownership of a property upon fulfilling specific conditions outlined in a contract, such as a Purchase and Sale Agreement (PSA). Equitable title grants the buyer the ability to enforce the agreement and expect to receive the legal title upon completion of the sale, which illustrates their interest in the property even before the actual transfer of legal title occurs.

This concept is particularly important because it protects the buyer's rights while the transaction is being finalized. Even though they do not hold legal title yet, they have an interest that courts will recognize. This allows them to potentially seek remedies if the seller does not comply with the terms of the agreement.

Legal title remains with the seller until the sale is completed, and true ownership is transferred, meaning the other options that imply full ownership or equal holding of title are not accurate.