Understanding How to Hold Title When
Buying a Property: Things You Need to Know
Holding title is
evidence that you own your home. How you hold title is important because
the various forms of ownership have different rights and obligations and
determine your rights to dispose of the property. Some of the more common ways
to hold title are outlined below. Keep in mind that these are general
descriptions and are not intended as legal definitions or advice.
Option 1: Sole Ownership
A man or woman who is not married.
An unmarried man/woman: A man or woman, who
having been married, is legally divorced.
A married man/woman, as his/her sole and
separate property: When a married man or woman wishes to acquire title as their
sole and separate property, the spouse must consent and relinquish all right,
title and interest in the property by deed or other written agreement.
Option 2: Co-Ownership
Community Property: Property acquired by husband and wife, or either during marriage, other than by gift, bequest, devise, descent or as the separate property of either is presumed community property. In other words, all property owned or
acquired by a married person is considered to be community property unless the
person can prove that it is separate property. Each spouse owns one-half of the
property and has an equal right of management and control of the community
property, but neither spouse may enter into any form of agreement to buy, sell,
or mortgage the property without the other spouse's consent. Community property
cannot be used to satisfy a separate debt of either spouse.
Community Property with Right of Survivorship: A
form of vesting title to property owned together by spouses or by domestic
partners. This form of holding title shares many of the characteristics of
community property but adds the benefit of the right of survivorship similar to
title held in joint tenancy. On the death of an owner, the decedent’s interest
ends and the survivor owns all interests in the property.
Joint Tenancy with Right of Survivorship: Joint
and equal interests in land owned by two or more individuals created under a
single instrument with right of survivorship. In other words, each joint tenant
owns an undivided interest in the entire property. The “survivorship”
language means that if one joint tenant dies, that person’s interest
automatically is transferred to the remaining joint tenants.
tenant may freely transfer his or her fractional interest in the property
during his or her lifetime, but any such transfer will terminate the
survivorship aspects of the joint survivorship tenancy to the extent of the
interest transferred. Equal ownership shares are presumed unless the deed
Tenancy in Common: Under tenancy in common, the
co-owners own undivided interests; but unlike joint tenancy, these interests
need not be equal in quantity and may arise at different times. There is no
right of survivorship; each tenant owns an interest, which on his or her death
vests in his or her heirs or devisee.
Trust: The trustee of the trust holds title
pursuant to the terms of the trust for the benefit of the trustor/beneficiary.
Because the parties are in need of money does not mean that the listing price of the property should be the grand total of the money each party needs to get out of the proceeds of the sale. If you do so, the property will stay on the market and will most likely end up selling for less than its fair market value.
Hope this helps.