The way you choose to take ownership of a property plays a crucial role in several aspects during and after a real estate transaction. The vesting of title determines who will sign different documents related to the property and future rights of the owner. The matters involving such rights include income taxes, property taxes, gift taxes, inheritance, exposure to creditorâ€™s claims, and transferability of title. It is imperative that you get legal assistance of an experienced real estate attorney to determine which method of vesting title will be the most beneficial in your particular situation.
Common Methods of Vesting Ownership
- Sole Ownership
A sole ownership refers to ownership a single person or entity. In such a case, there is no need for indicating this fact on the deed or for special vesting. When the owner passes away, the real estate goes to probate for the eligible heirs to claim inheritance of the property. Â An unmarried man/woman, a single man/woman, and a married man/woman with a separate sole property are some examples of sole ownership.
- Tenancy in Common
When two or more individuals jointly own a property in equal or unequal percentages, it falls under the tenancy in common vesting. None of the tenants in common have right of survivorship and can lease, sell, or include their share of the real estate in their will. In case a co-tenant dies, their share of property will undergo the probate process.
- Joint Tenancy
The type of vesting ownership requiring two or more owners with equal percentages of ownership is known as joint tenancy. The individuals may or may not be married and have the right of survivorship in the event any joint tenant passes away. Moreover, a joint tenancy property cannot be included in a will, as the title of the propertyâ€™s share is automatically transferred to the surviving joint tenants. It is essential for the document to clearly state the intention of joint tenancy of the property, and all co-tenants must acquire its title at the same time.
- Community Property
This form of holding title refers to a property owned by a married couple that the husband and wife intended to own together. Unless otherwise stated, a real estate is presumed to be a community property if it is transferred to a married man or woman. Since the property is equally owned by both spouses, they must sign all documents and agreements of transfer together. Moreover, either spouse can dispose of their share of the community property, which may include transfers by will.
- Tenancy by Entirety
In this form of ownership, both husband and wife own the entire property, unlike community property. If one of them dies, the surviving spouse gets the ownership of the property without having to go through probate.
If you want assistance in deciding which form of vesting ownership is suitable for your case, contact Casement Group, P.C. today at (847) 888-9300 for a free consultation with an experienced and reliable real estate attorney.