What does "bare legal title" refer to?

"Full legal title" typically refers to the ownership of property that includes both the legal and equitable rights to the property, while "bare legal title" means holding the title to property without any accompanying beneficial interest. This is commonly seen in situations involving a trust. In this context, a trustee holds bare legal title to the property for the benefit of the beneficiaries of the trust.

When a lender uses a trust deed to secure a loan, the trustee is given the legal title to the property, but that title is only "bare" because it does not confer any rights to the property itself beyond what is necessary to execute the trust. The trustee has the responsibility to hold and manage the property, but the beneficiary of the trust possesses the equitable interest, meaning they have the right to enjoy the benefits of the property, like receiving income from it or selling it.

Understanding bare legal title is crucial in real estate because it clarifies the separation of rights between the legal title holder (the trustee) and the equitable title holder (the beneficiary).