When does an equitable conversion (EC) occur?

An equitable conversion occurs when a contract for the sale of real estate is signed. This legal doctrine recognizes that, upon the signing of a valid contract, the buyer is considered the equitable owner of the property, while the seller retains legal title. This shift in ownership characterizes the buyer's right to benefit from the property, even before formal title transfer occurs.

Additionally, once all contingencies in the contract are satisfied, this further substantiates the buyer's equitable interest in the property. Once contingencies, such as inspections or financing approvals, are fulfilled, the buyer's rights and interests are firmly established.

Thus, equitable conversion effectively encompasses both the signing of the contract and the satisfaction of contingencies, aligning with the concept that the buyer holds an equitable interest during the period leading up to the transfer of legal title.