Unit 4/Class 4 Flashcards
Individuals who take title to property as tenants in common own…
an undivided fractional share in the whole property
- “ an undivided interest in the whole”
Three people own property as joint tenants. If one of the owners die and one of the surviving owners sells his interest, how does the remaining owner and the purchaser own the property?
As tenants in common
Tenants by the entirities means…
legally married; unity of person
Joint tenancy and tenancy by the entirities is similar in that…
severalty ownership occurs when all owners except one have died
A real estate agent who is requesting a copy of a resolution before listing a property for the owner is most likely dealing with what/who?
A corporation
Suit for partition
dividing ownership interests
Investors who own rental property and pay tax only on their returns on their investment and enjoy the benefits of limited liability are probably what kind of partners?
Limited partners
If an individual purchases a cooperative unit, what can they deduct?
may deduct paid real estate taxes and interest from their taxable income
maintenance fees charged by a condominium association is determined by who
the board of directors of the condo association
Interval ownership is best associated with…
time shares
The primary difference between a partnership and a joint venture is….
joint ventures last for a short period of time (because its for a single project) while partnerships are usually ongoing
Why would an individual not take title to property with a corporation as a joint tenant?
Because a corporation has a perpetual existence. No survivorship interest, cant “will” it to someone else, etc.
What are the four unities of joint tenancy?
possession
interest
time
title
A parcel of property was purchased by two friends. The deed they received from the seller at closing transferred the property without stipulating a form of ownership. The two friends took title as what?
Tenants in common
- when joint tenancy is not clearly prescribed in the deed, the ownership defaults to tenants in common
A man owns one of 20 units in fee simple, along with a 5% ownership share in the parking facilities, recreation center and grounds. What kind of property does he own?
Condominium
A trust is a legal arrangement in which property is held for the benefit of a third party by a…
trustee
According to some states, any real property that either spouse owns at the time of marriage remains separate property. Further, any real property acquired by either spouse during the marriage (except by gift of inheritance or with the proceeds of separate property) belongs to both of them equally. What is this form of ownership called?
Community property
Three people were concurrent owners of a parcel of real estate. When one of the owners died, that interest became part of the deceased’s estate. The deceased was under what kind of ownership?
A tenant in common
A legal arrangement under which the title to real property is held to protect the interests of a beneficiary is a….
trust
A person lived in an apartment building. The land and structures are owned by a corporation, with one mortgage loan securing the entire property. Like the other residents, this person owns stock in the corporation and has a lease to the apartment. This type of ownership is called…
Cooperative
A corporation is a legal entity, recognized as an artificial person. Property owned solely by the corporation is owned in….
severalty “own it alone”
What type of ownership is ownership by one person?
Severaly
severed - cut off
The real property interest that takes the form of person property is….
cooperative unit ownership
bc coop ownership is personal property, NOT real property
What is evidence of ownership in a cooperative?
Shareholder stock
An ownership interest that can be an estate interest or a right of use is….
a time share.
what is the similarity between joint tenancy, and tenancy by the entirety
The last survivor becomes the severalty owner
If property is held by two or more owners as joint tenants, the interest of a deceased co-owner will be passed to….
the surviving owner or owners
Real estate can be held in what three ways?
Severalty (one owner)
Co-ownership (more than one owner)
Ownership by a trust (property held for the benefit of another)
When title to a parcel is held by two or more individuals, those parties are called ______
co-owners or concurrent owners
JUST A NOTE:
Individuals may co-own property as tenants in common or joint tenants. during the lifetime of the co-owners, there may be no apparent difference between the types of ownership. only when the property is conveyed, or when one of the owners dies, will the differences become apparent
Forms of Co-ownership / concurrent ownership
Tenancy in common
joint tenancy
tenancy by the entireties
Community Property
Tenancy in Common
Undivided interest in the whole.
Undivided fractional interest in the property.
These types of co-owners have unity of possession, meaning that each owner is entitled to possessio and use of the entire property, even though they each hold only a fractional ownership interest.
With tenancy in common, it is the _________, not the property, that is divided
ownership interest
The ______ creating a tenancy in common ma or may not state the fractional interest held by each co-owner. If no fractions are stated, what happens?
Deed
the tenants are presumed to hold equal shares
With tenancy in common, because the co-owners own separate interest, they can….
sell, convey, mortgage, or transfer their individual interest in the TIC without the consent of the other co-owners.
Tenancy in common gives each owner a separate and distinct ____ interest in the property with the right to ________.
distinct title
possession
Joint tenancy occurs when two or more own the property, and a ________ exists with the right of __________
unity of ownership
survivorship
Explain probate and joint tenancy
Because the interest of a deceased joint owner passes to the surviving owners, probate is not required. Spouse of the deceased has no marital rights to the property.
Joint tenancy can NOT be created by law. The parties must show their intent to be joint tenants and the unities of (1-4)…
Time (must be taken at same time (otherwise its tenancy in common)
Title (title taken by the same document via one deed)
Interest (each owner has equal interest)
Possession (all owners have the right to possess the entire property)
Lets say Joe and Jay want to create a joint tenancy but they do not take title at the same time. what happens?
it becomes a tenancy in common. MUST meet all four unities.
What is the distinguishing differences of a joint tenancy
Must meet all four unities
Right of survivorship
Rights and obligations of a joint tenant
Like tenants in common, joint tenants may sell, mortgage, or convey their interest without the consent of the other owners and must pay their share of maintenance fees.
When does a joint tenancy become terminated
If any of the unities are broken
For example: a joint tenant sells his interest to another. This terminates his joint tenancy ownership and the buyer takes title as a tenant in common.
Partition is a suit in equity to _________
divide ownership interest
For example: two owners joint tenants or tenants in common want to sell the property while other owner does not. The owners would seek partition.
Its a legal way to dissolve the relationship. if the court determines that the property cannot be divided physically into separate parcels without destroying its value, the court will order the real estate to be sold. The proceeds of the sale will then be divided among the co-owners according to their fractional interests.
Both joint tenancy and tenancy in common have what in common
An undivided interest in the whole
Can a joint tenant will his interest to another?
No, it will go to the survivor
Tenancy by the entirities is a special form of co-ownership that can only be held by who?
Married couples
Who owns the property in tenancy by the entirities, and what is the root of the restriction
both spouses own the entire property. Neither spouse can force a partition or sell the property without the consent of the other.
Tenancy by the entirities contains the unity of person
For tenancy by the entirities - they can convey title only by….
a deed signed by BOTH parties
Community property rights recognize two types of property:
separate property and community property
views the spouses as equal partners, rather than one unit like tenancy by the entirities
Trust: when a property is placed in trust, the owner (_____) transfers title to a ______ who holds the title for the benefit of another called the ________.
trustor
trustee
beneficiary
In a trust, who hold legal title and who holds equitable title
Until the property is conveyed, the trustee holds legal title and the beneficiary has an equitable title.
What document spells out the responsibilities of a trustee?
Trustee agreement
A trust created during the property owner’s lifetime is called a ________. If established by will after the owner’s death it is a __________.
Living trust
testamentary trust
when is joint tenancy terminated?
When any of the unities are terminated
Can a corporation have a joint tenancy
No because corporations do not die. And sense a joint tenant cannot will his interest to another and it goes to the survivor, this does not work.
Explain tenancy by the entirities in regard to survivorship and divorce
Survivorship: because each spouse owns the entire property, upon death, the surviving spouse becomes the severalty owner. Probate is not required.
Divorce: would become tenants in common because the unity of person is broken
___________ are business arrangements between two or more owners who carry on a business for profit.
Partnership
If you form a general partnership you are each ____% liable.
How can general partnerships be dissolved?
you are each 100% liable
*This is a distinguishing characteristic. All partners may manage the partnership and have full liability.
Death, withdrawal or bankruptcy of a partner
How is title to property held for partnerships
in the partners names, or
Under the Uniform Partnership Act, title can be held in the name of the partnership
What is a limited partnership?
passive investors who cannot participate in the management of the partnership. They have liability up to the amount of the individual’s investment
_______ are legal entities that are considered to be one person
Corporations
An agent who is dealing with a corporation needs a copy of the corporate __________ which verifies who signs legal papers for the corporation
resolution
Corporations hold title according to their…
charter
What is an S Corp
Hybrid between an LLC and corporation
What are S corporations
A hybrid between LLC and corporation.
Limited Liability companies differ from corporations in that they do not have ________
perpetual existence
Condominiums is a blending of…..
severalty and common ownership
The condominium form of ownership is created when a developer, called the declarant, files a ________ and records a _______
files a declaration and records a master deed.
When a property owner changes the form of ownership of a property, the act is called a……
conversion
A ________ conveys the land to condominium ownership while the ________ creates the condominium form of ownership
Master deed
declaration
What are bylaws
Document containing the rules and regulations for the management of the condominium
Does forclosure of one condo unit affect the rest of the condo owners?
No
A ________ is an apartment complex whereby ownership of the property is held by a corporation and the occupants receive stock and a lease that allows them to occupy the unit
Cooperative
What do you “own” if you are part of a cooperative?
You own stock, which is personal property. You do NOT own real estate.
Like condo owners, owners of cooperatives pay a maintenance fee. ONe primary difference however is that the maintenance fee includes the coop occupant’s share of…
taxes
insurance
the one mortgage that is on the property
What type of ownership do you have with a timeshare?
Interval ownership; There is no ownership in the building, its just the right to use a property during a specific period of time
