Part 5 Flashcards
Forms of Property Ownership
Ownership by a single owner or single entity.
Ownership in severalty
1 of 3 ownership forms
A __________ is a legal entity composed of individuals conducting business as if they were a single person.
Corporation.
Ownership in severalty > Corporation
A corporation or trust that combines the capital of many investors to acquire or provide financing for all forms of real property is called what?
Real estate investment trust (REIT)
Ownership in severalty > Real estate investment trust (REIT)
A private or public partnership that pools funds for the acquisition and development of real estate projects or other business ventures is called what? They can also operate as a partnership, limited partnership, corporation, or a REIT.
Syndication.
Ownership in severalty > Syndication
When property is held by two or more individuals and is categorized into four types what is it called?
Co-ownership
1 of 3 ownership forms
Real estate may be owned by two or more people. Each owner possesses an undivided fractional interest in the property held under a ___________ __________ __________.
2a. The property is not physically divided.
2b. The ownership interest is divided, and the co-owners are entitled to possession of the whole property.
4b. Upon the death of a co-owner, the undivided interest passes in accordance to the will of that owner.
tenancy in common
Co-ownership > tenancy in common
Justin owns a property with three other people. When Justin dies, his interest will be passed according to his will and be part of his estate. In this property, Justin is a what?
Tenant in common.
Williams owns property with Campbell by tenancy in common. When Williams dies, her interest in the property will go to who?
her heirs or according to her will.
_______ _______ involves two or more people holding real estate but w/ right to survivorship. When a tenant dies under this co-ownership, the interests are passed to the other surviving tenant(s) and not to the heirs or according to a will.
Joint tenancy
Co-ownership > Joint tenancy
Joint tenancy has a right of survivorship feature shared with what other form of ownership?
tenancy by the entirety
Form of co-ownership for married couples in which each spouse has an equal, undivided interest in the property is called what? Husband and wife have rights of survivorship.
Tenancy by the entirety.
Co-ownership > tenancy by the entirety
What is it called when real estate is transferred to another person (called a fiduciary) to hold or manage for the benefit of a third party?
A trust.
1 of 3 ownership forms
An individual, couple, or organization who places the legal title of the property in a trust is called what?
Trustor
A third party who is legally responsible for managing assets or property for the benefit of another party is called what?
Trustee
Also known as a fiduciary
A person or group of people who are designated to receive benefits from a trust, such as the trust’s property, income, or other advantages is called what?
Beneficiary
Rick and Alice set up a living trust for their children involving a rental property they own. In this type of agreement, the children are legally referred to as the what?
Beneficiary.
The person has the responsibility for holding/managing the property in a trust.
Fiduciary
a.k.a. Trustee
The Acme Corporation set up a land trust in a property it owns and conveys it to a nonprofit organization for a specified period of time. What best identifies Acme’s position in the trust?
Acme is the trustor.
Owners of an individual ___________ unit hold a fee simple title
Condominium unit hold complete and irrevocable ownership of land and any buildings on it.
Condominium owners also hold an undivided interest in the remaining condominium real estate, known as ___________ __________ .
common elements.
Land
Community buildings
Swimming pools
Tennis courts
Boat slip for waterfront properties
Parking spaces
All describe which common elements?
Common elements outside the building.
Does not include public streets and sidewalks that give access to the condominium property
Lobby
Hallways
Elevators
Underground garage
Exercise room
Balconies
Laundry
Storage areas
All describe which common elements?
Common elements inside the building.
Under ___________ ____________ a corporation actually owns the real estate and individuals own shares of stock in the corporation.
cooperative ownership
Purchasing a cooperative unit means you are buying what?
shares of stock.
A fee simple interest in condominium ownership with accompanying rights. The ownership rights are limited to a specified time period, but the owner can still mortgage, lease, sell, or bequeath the rights is called what?
A timeshare.
A type of building development designed as a grouping of complementary land uses, such as housing, schools, recreation, retail, office, and industrial parks, contained within a single master development. They are not an ownership type.
Planned Unit Development.
Development that seeks to meet the needs of the present w/o compromising the ability of future generations to meet their needs.
Sustainable development.
The party that gives the mortgage is called?
Mortgagor.
The mortgagor is the borrower
- Ownership in severalty
- Co-ownership (aka concurrent ownership)
- Trusts
This list describes what?
3 primary groups of ownership forms
Tenancy in common
Joint tenancy
Tenancy by the entirety
Community property
This list describes what?
Four types of co-ownership
Nine states use this system for property owned by husband and wife. Each spouse has an undivided one-half interest in property acquired during the marriage. In contrast to joint tenancy, when one spouse dies, the survivor is entitled to one-half of the ____________ ____________. The other half is distributed according to the will of the deceased. If there is no will, the interests will go to the surviving spouse (or other heirs) depending upon applicable laws of the state.
community property rights
Co-ownership > community property
___________ ___________ is a legal arraignment that lets you decide how your assets are managed and distributed, both during your lifetime and after you die. This type of trust “owns” the property you put into it, while often still letting you control the trust assets.
Living trust
Trust > Living trust
___________ ___________ is a legal arraignment where real estate is the only asset in the trust. The property title is conveyed to a trustee, but the trustor in this case is also the beneficiary. The trustor has a beneficial interest in the property, and that interest is actually treated as personal property.
Land trust
Trust > Land trust
The Hawthorns bought a condominium unit in a resort area for $500,000. They use the condo for one month out of every year and during the remaining months, they rent it out through an agreement with the property management. This is an example of what type of ownership?
condominium
