What legal document formalizes the transfer of ownership in real estate?

The correct answer is the deed, as it is the legal document specifically used to transfer ownership of real estate from one party to another. A deed typically includes important details such as the names of the grantor (seller) and grantee (buyer), a description of the property, and the signature of the grantor. The act of executing and delivering the deed constitutes the formal transfer of property rights.

While the title is a term used to denote ownership and might often accompany the deed, it does not serve as the actual instrument that conveys ownership. The lease, on the other hand, is a contract that grants temporary possession of a property to a tenant but does not transfer ownership rights. Similarly, a contract refers to an agreement between parties and while it can be used in the context of a real estate transaction, it does not itself result in the transfer of ownership; that function is explicitly fulfilled by the deed.