Before you reach the closing day, you will want to make a decision as to how you will "hold title" to the property. This decision has legal, tax and estate planning ramifications. Therefore, it may be prudent to consult an attorney, certified public accountant (CPA), and your financial planner.

The following information is supplied for informational purposes and should not be relied upon as legal definitions.

Buying Alone

Sole Ownership must be: (a) a single individual who has not been legally married; or, (b) an unmarried individual who was married and is now legally divorced; or, (c) a married individual who wishes to acquire title in his or her name alone. At the time of closing, the spouse of the buyer will be required to specifically disclaim or relinquish his or her right, title and interest to the property.

Living Trust is created while an individual is alive and gives the individual control of the distribution of his or her estate. The individual transfers ownership of his or her property and assets into the trust.

Buying with Others

Tenancy in Common enables each partner in the property to sell, lease or will to his/her heirs that share of the property belonging to him/her. property owned by two or more persons at the same time. The proportionate interests and right to possess and enjoy the property between the tenants in common do not have to be equal. Upon death, the decedent' s interest passes to his/her heirs named in the will who then become new tenants in common with the surviving tenants in common. Words in the deed such as "Fred, Barney, Wilma and Betty as tenants in common" establishes tenancy in common.
  • Who can take title? Any number of individuals.
  • Ownership Division: Any number of interests, equal or unequal.
  • Who holds title? A separate legal title to his undivided interest is held by each co-owner.
  • Possession: Equal right of possession.

Joint Tenancy is property owned by multiple individuals in equal shares. Each joint tenant has an undivided right to possess the whole property and a proportionate right of equal ownership interest. If one of the owners dies, the remaining owners acquire the share of the deceased owner automatically. When one joint tenant dies, his/her interest automatically vests in the surviving joint tenant(s) by operation of law. Words in the deed such as "Fred and Wilma, as joint tenants with right of survivorship and not as tenants in common" establishes title in joint tenancy.

  • Who can take title? Any number of individuals.
  • Ownership Division: Interests cannot be divided.
  • Who holds title? There is only one title to the whole property.
  • Possession: Equal right of possession.

Community Property or Tenancy by the Entirety is property owned equally between a husband and wife. Each must sign all agreements and documents of transfer. Neither spouse can sell the property without the consent of the other. Words in the deed such as "Fred and Wilma, husband and wife as tenancy in the entirety" establishes title in tenancy by the entireties.

  • Who can take title? Only a husband and wife.
  • Ownership Division: Interests are equal.
  • Who holds title? Similar to title being in a partnership, title is held in "community."
  • Possession: Equal right of possession.

Additional Ways to Hold Title

A Corporation is a legal entity, created under state law, consisting of one or more shareholders but regarded under law as having essentially the same as those of an individual. The entity has continuous existence until it is dissolved according to legal procedures. Land owned by a corporation cannot be attached for personal debts or judgments rendered against any of its shareholders.

A Partnership is an association of two or more persons who can carry on business for profit. A partnership may hold title to real property in the name of the partnership with partners having an equal or an unequal interest in the property.

A Trust is an arrangement whereby legal title to property is transferred by the grantor (or trustor) to a person called a trustee, to be held and managed by that person for the benefit of the people specified in the trust agreement, called beneficiaries.