Forms of Real Estate Ownership Flashcards
Ownership in Severalty
when property is owned by one individual, corporation or other entity
Co-Ownership
when title to a parcel of real estate is held by two or more individuals
Tenancy in Common
each tenant holds undivided interest in the property and have unity of possession; they are entitled to use of the full property even though they hold fractional ownership
Joint Tenancy
property owned by two people whether married or unmarried
Right of Survivorship
upon death of a joint tenant the deceased’s interest transfers directly to the surviving joint tenant or tenants
Creating a Joint Tenancy
must be by the intentional act of conveying a deed or giving the property by will or living trust
Elements to Create a Joint Tenancy (PITT)
possession, interest, time and title
Terminating a Joint Tenancy
when one of the four elements is terminated
Partition
a legal way to dissolve the relationship between co-owners of real estate when the parties do not voluntarily agree to its termination
Tenancy by the Entirety
special form of co-ownership used in some states that allows a spouse to inherit the other spouse’s ownership
Community Property
laws based on the idea that spouses are equal partners and property acquired during marriage is obtained by mutual effort
Separate Property
property that was owned solely by either spouse before the marriage, purchased with separate funds during marriage or acquired by gift or inheritance to one spouse
Trust
a device by which one person transfers ownership of property to someone else to hold or manage for the benefit of a third party
Trustor
the person who creates the trust
Beneficiary
the person who benefits from the trust
Trustee
the party who holds legal title to the property and is entrusted with carrying out the trustor’s instructions regarding the purpose of the trust
Fiduciary
a person who acts in confidence or trust and has a special legal relationship with the beneficiary
Living Trust
created by agreement during the property owner’s lifetime
Testamentary Trust
established by will after the owner’s death
Land Trusts
trusts where real estate is the only asset; public records usually do not name the beneficiary and generally it continues for a definite term
Partnership
an association of two or more person who carry on a business for profit as co-owners
General Partnership
all the partners participate in the operation and management of the business and share full liability for business losses and obligations
Limited Partnership
one or more general partners, as well as limited partners. general partners fun the business and limited partners are not legally permitted to participate and therefore can only be held liable for business losses for the amount they invested
Uniform Partnership Act
provides for the continuation of the existing business if a partner dies, withdraws or goes bankrupt
Cooperation
a legal entity created under the authority of the laws of the state from which it receives its charter; managed and operated by a board of directors selected by shareholders - can own real estate in severalty or as a tenant in common
Limited Liability Company
business organization with limited liability like a corporation and tax benefits like a partnership
Condominium Ownership
horizontal property acts; owner of each unit holds a fee simple title to the unit as well as a specified share of the undivided interest in the remainder of the building
Common Elements
land, courtyard, lobbies etc that condominium owners have an undivided interest in as tenants in common
Right of First Refusal
in condominium ownership; owner is required to offer the unit to the same price to the other owners in a condominium or the association before accepting an outside offer
Cooperative Ownership
corporation holds title to the land and the building then offers shares of stock to prospective tenants; purchaser becomes a shareholder in the corporation by virtue of that stock ownership - stock is personal property so they do not own real estate only interest in the corporation
Time-Share
real property interest in a specified unit for a particular period of the year
