A-2 Real Estate Interests and Ownership Flashcards
The degree quantity, nature and extent of ownership interest that a person has in real property. It refers to one’s legal position of ownership, not to the amount of property owned.
Estate
Property ownership and indeterminate duration. Fee estates (inheritable), and life estates (not inheritable)
Freehold Estates
(leasehold) estates, where tenants such as renters possess (occupy) but do not own property.
Less than free hold
There are two under this category: Fee simple absolute, and fee simple defeasible
Fee Estates
Property is wholly owned, transferable and inheritable. It is the most common and complete form of ownership.
Fee simple absolute
Stipulations in the deed that if not adhered to by the grantee, can result in the property reverting tot he original grantor Two forms: Fee determinable, and fee conditional
Fee simple defeasible. (two forms)
( usually regarding person… if person x never spends a day in jail) If stipulation is violated, that person’s ownership of the estate is automatically terminated and reverts to the grantor or his/her heirs.
Fee determinable
The wording of the deed controls the function of the property and is tied to a specific condition or event. (If condition is violated reversion would require the grantor to initiate a court action)
Fee Conditional
Limits heirs to lineal descendants (not in Arizona)
Fee tail
Include real and personal property. Ordinary (conventional), and statutory.
Life estates
Limited in duration to the life of its owner or to the life of some other designated person.
Ordinary (conventional) Life estate
Dower, curtesy, community property, and homestead
Statutory Life Estate
Spouses share an equal interest in property acquired during marriage.
Community property
Owned an occupied as principal interest, and protects up to 150,000 of property equity. Protects against unforeseen liens, judgments, or bankruptcy, and may prevent the home from being sold out from underneath them.
Homestead
a tenant possesses a leasehold estate and the landlord possesses a reversionary fee estate.
Less than freehold estates (leasehold)
What are the four types of leasehold estates
- Estate for years 2. Estate from period to period 3. Estate at will 4. Estate at sufferance
Estate for years
Runs for a specific time period
Estate from period to period
Runs for an indefinite number of periods (usually 30 day increments)
Estate at will
Runs for as long as the lessor and lessee will it. Either party may cancel at will
Estate at sufferance
Runs until the landlord takes action. This scenario usually involves a tenant in arrears who refuses to leave.
What is required for a valid lease 5 Things:
Lessor’s Signature, the landlord intent to “let and demise”, the time period of occupancy, the consideration (amount for rent), and the landlords right of reversion.
Gross Lease
Landlord pays all taxes, assessments and operating costs . (apartments)
Net Lease
Landlord keeps all the rent while tenants pay overhead. (generally long term)
Percentage leases
Tenants pay a base rent against a percentage of their gross sales. (usually figured monthly)
Index and Graduated Leases
Index Leases generally use the consumer or wholesale price index. Graduated Leases start small and grow at fixed intervals.
Ground Lease
One person owns the land and another owns the building. Max 99 years.
Assignment
the renter (assignor) transfers his or her entire interest and contractual obligation
Negative Leasehold
When the contract rent exceeds the economic rent
License
Personal permission to perform a particular act on the land or property of another (hunting)
What is an Easement & Name two principal classes
Non revocable right which one person has in the land of another. 1. easements appurtenant 2. Easements in Gross
Easement Appurtenant
Always involves multiple parcels. The dominant tenement is incapable of existence separate and apart from the particular land to which it is annexed. (Passes with the Land)
Involves one parcel of land, for the use of another. Not revocable, and creates an interest in the real estate, where granting a license does not. Only has a servant tenement.
Easement in Gross
Easements may be created by:
Express agreement, implication, by necessity, or by prescription
Easement created by open, continuous and exclusive use under claim of right for the required statutory period (10 years)
Easement by prescription
The mode, manner, quality, and way that ownership of an estate is held by a person, persons, or legal entity
Tenancy
An estate held by one person in his own right only
Severalty
An estate in fee simple; for life, for years, or at will , and arises by purchase or gran to two or more natural persons. (Survivorship if in the deed, AZ not assumed survivorship)
Joint tenancy
Joint tenancy: Unity of time
Estates of the tenants be vested at one and the same time.
Joint Tenancy: Unity of Title
Signifies that joint tenants hold their property by one and the same title, while tenants in common may take the property using several titles
Joint tenancy: Unity of Interest
This means that equal interest must accrue by one and the same conveyance. (no one can have a greater interest)
Joint Tenancy: Unity of Possession
Joint tenants must hold the same undivided possession of the whole and enjoy the same rights until the death of one
Ownership of realty by two or more persons, undivided interest which may be voluntarily transferred by alienation, devise, or descent and is not subject to any right of survivorship.
Tenancy in Common
Community property
all property acquired by either husband or wife during the marriage
community property right of survivorship
No probate after death of spouse. Automatic transfer
