Chapter 08 forms of real estate ownership Flashcards
Serveralty
Title is held by individual or corporation
Co ownership
Title is held by two or more individuals
Estate in trust
A neutral individual holds the title for the benefit of another
Tenancy in common
- All owners own an equal share unless specified in the deed
- all owners have possession of whole property
- Each owner can transfer share freely
- When co ownership is unspecified, Tenancy in common is the default
Joint Tenancy
Right of survivorship:
Upon death of joint tenant, shares go to surviving joint tenants
Creating a joint tenancies
Four units necessary to create a joint tenancy (PITT):
- unity of possession
- Unity of interest
- Unity of time (all acquire interest at same time)
- Unity of document ( all on the same document)
Terminating a joint tenancy
- If any units are destroyed
- if joint tenants transfer ownership to another, previous joint tenants remain JT, but their relationship with new party is a tenancy in common.
Partition suit
Partition is a legal way to terminate a joint tenancy when not all parties agree. If the court decide that property cannot be physically broken up into separate parts, they order property to be sold and proceeds to be split.
Tenancy by the entirety
Ownership by married couples.
- Surviving spouse inherits property
- neither can transfer deed without permission from the other
Trust
A device by which one person transfers ownership of property to hold or manage for the benefit of a 3rd party
Trustor
The person who creates the trust
Trustee
The party who holds legal title and is trusted to carry out trustors instructions
Beneficiary
Person who benefits from trust
Testamentary trust
Established by will after death
Living trust
Created by trustor during their lifetime
Land trust
- Real estate is the only asset
- Trustor is usually the beneficiary
- Beneficiary retains rights and control
- often used for conservation or secretiveness
Partnership
The association of two or more persons who carry on a business for profit as co owners.
- General partnership
- limited partnership
General Partnership
All partners participate and share full liability
Limited Partnership
Consist of one or more general partners and limited partners.
Limited partners are not legally permitted to participate.
Corporations
- Legal entity (artificial person)
- Created under laws particular state
- Managed by board of directors
- can own property in severalty or tenants in common
Limited liability company (LLC)
Combines the benefits of corporations and limited partnership.
Condominium ownership
Condominium laws ( horizontal properties acts) are enacted by the state and give owners fee simple title.
Owners have share of common area
Shared elements are tenants in common
Right of refusal
When Hoa requires owner to ofer other owners property first at same price before listing it with the public
Time share
Time share estate: no expiration
Time share use: Expires
