De Facto

Bion Grady, Real Estate Agent Atlanta Communities Real Estate

Wondering what “de facto” means?

Well, because it’s a Latin word, let’s give a formal definition. De facto is Latin for indeed, in fact, in reality, actually. An act or fact that occurs as a matter of practice and reality is distinguished from “de jure”, meaning a lawfully and rightfully occurring act. A de facto action or occurrence is accepted as a matter of fact but is illegal or illegitimate. 

Ok, now let’s give a more down-to-earth, less snobby de facto definition, shall we?

De facto is everything that is in practice, not necessarily in theory. For example: think of a house owned by a Father, but occupied by his Daughter. The owner de facto is the Father, although the daughter is the one who will answer the door when someone knocks and asks to talk to the owner of the house. Concomitantly, the resident de facto is the daughter, not the father – who owns the place, but lives elsewhere. Or what about USA’s language? Officially, by the laws that govern us, there is no official language (did you know that?!), however, the de facto language is, of course, English. 

In this example, the term de facto defines the physical custody of the property. While the daughter uses and benefits from living on the property, she is de facto the resident of the property. However, no legal accusation can be brought against her unless she claims to be the owner of the property in official documents.

De Facto Possession

This de facto definition is used in the court of law to refer to things that exist in reality even if it’s not made “official” by contracts and laws. For example, someone living in a rental that doesn’t have a lease on their name for the rental is a de facto possessor of the property.

However, while the landlord is the owner, they are not de jure possessor of the property either. The actual renter who does not live on the property is the de jure possessor as there is a lease on his name.

As we mentioned the terms de facto and de jure, we need to establish that in real estate both terms relate to possession. The term possession is usually understood as having physical control over something. As this refers to a first impression that is not based on any kind of verification of right, it was necessary to explain further. While someone can hold something, that those not always mean that they are the owner of that object. That’s where the term de facto comes into play as the owner of that possession, or the de jure possessor can prove their legal ownership while the de facto possessor can not.

What is De Facto in Real Estate?

De facto possession in real estate deals with physical custody of tangible assets. When someone has de facto possession of an apartment, they have physical control over it. But de facto possession can be divided into two types.

• Corpus of possession - the de facto possessor can exert physical control over property through physical force, walls, windows, doors, or through their presence on the property. In order for others not to interfere with the property, the possessor must have some form of physical control over the property.
• Animus - the animus possessor refers to the possessor of a property that has the intention or will to retain control over the property. In other words, the animus is defined as the conscious intentionto stop other people from interfering with their right of possession. 

Despite all of this, physical control or intention of control over property does not equal legal possession or legal right of use.