Real Estate Ownership:

- forms of real estate ownership vary according to the number of owners or to some types of
property
- The form of ownership determines the legal rights and obligations of the owners, and will afect
transferability, inheritability, and bankruptcy
1. Ownership in severalty
- also known as tenancy in severalty
- when real estate is owned by a single person or legal entity, and provides the owner with the
most complete control of the land (free to do anything with the property that is within the law
without anyone elses permission)
- the name is derived from the fact that the owner is severed from other owners
2. Concurrent Estates
- real estate can be co-owned
a. Tenancy in Common
- when the concurrent owners own a fractional interest in the property (which may vary
according to owner, or usually it is divided e!ually)
- title to the real estate will list all of the owners and their share of ownership if it is not
e!ual ("f ownership share is not speci#ed, then the ownership is divided e!ually)
- $ach co-owner has unity of possession% &owever, each co-owner can sell,
mortgage, or convey his interest'but not the entire property'without the consent of
the other co-owners%
( )hen the deed listing concurrent owners does not indicate the form of
ownership, and the co-owners are not married, then the form of ownership is
as a tenancy in common%
* "f the co-owners are married, then the form of co-ownership can be a tenancy
be the entirety, community property in community-property states, or, less
commonly, as a *oint tenancy%
b. oint Tenancy
- is like a tenancy in common, but the main diference is that the *oint tenants have an
undivided interest with ri!hts of survivorship% &owever, no single co-owner can
mortgage, sell, or otherwise convey any piece of the land without the consent of all
*oint tenants%
- +ften, *oint tenants are relatives who have received the property from a will
* ,n un"ivi"e" interest is an ownership right to use and possess the entire
property%
- )hen a *oint tenant dies, the ri!ht of survivorship entitles each surviving co-owner
to an e!ual share of the deceaseds share of ownership'thus, each *oint tenant
maintains an e!ual share with the surviving *oint tenants%
* &owever, the deed must e-plicitly confer the right of survivorship% The last
*oint tenant will own the land as a tenant in severalty, and will en*oy all of the
rights as the sole owner of property%
- ./$,T"+01 can only be created by intention or by will, not by implication or operation
of law%
o The deed must e-plicitly stipulate a *oint tenancy, and the owners must be
e-plicitly identi#ed as *oint tenants%
- T$/2"0,T"+01
o when any of the *oint tenants convey their ownership interest to another
party, who then becomes a tenant in common with the remaining *oint
tenants, but the original *oint tenants retain their rights and interest
o by a partition suit, which is a lawsuit to either partition the property so
that 3 or more of the *oint tenants has title to a speci#c portion of the
property, or
o the court can have it sold, with the proceeds of the sale divided e!ually
among the *oint tenants%
c. Tenancy by the Entirety
- is like a *oint tenancy, with the tenants having an undivided interest in the property
and with rights of survivorship, but difers from it in that
3% there can only be 4 tenants,
4% they must be married, and
5% their ownership interest cannot be conveyed without the consent and
signature of both tenants%

-T$/2"0,T"+01
by the death of a spouse, in which case, the surviving spouse has an
ownership in severalty6
by annulment, which converts the tenancy by the entirety into a tenancy in
common6
by agreement of both spouses6
or by a court-ordered sale to pay a debt for which both spouses have
liability%
". Community #roperty
- the property owned by a spouse is classi#ed as either separate property or
community property%
$eparate property
7 property owned by 3 spouse, and includes property ac!uired before
marriage, property received from a gift or will, and income earned from
separate property
Community property
7 any property or income received during marriage that is not separate
property
e. Trusts
- +ftentimes, land is transferred to a trust for the bene#t of bene#ciaries (minors or
incapacitated adults)
- a legal device created when a trustor (aka !rantor), the creator of the trust,
transfers assets to the trust to be invested or handled by a trustee, in whose name
the assets are titled, for the bene#t of the bene%ciaries%
( The trustee can be a person, but is often a trust company, a corporation
that provides this service% The trustee is usually compensated by fee that is
paid from the earnings from the trust% ,fter paying e-penses for running the
trust and the trustees fee, the remaining income generated from the assets is
usually paid to the bene#ciaries%
- may e-ist inde#nitely, or may be terminated upon certain conditions, such as when
the bene#ciaries reach a certain age, in which case, the assets of the trust are passed
to the bene#ciaries
- can be created while the trustor is alive or through the trustors will
- livin! trust
-created during the trustors lifetime, and, usually, the trustor is also the
trustee, which allows the trustor to continue to control and bene#t from the
assets%
- main purpose is to avoid the time and e-pense of probate% 8pon the death of
the trustor, the trusts assets can pass directly to the bene#ciaries without the
need to have the assets distributed through probate court%
- testamentary trust
- created by a will%
f. &an" Trusts
- has only land for its asset
- usually lasts for a stipulated period of time, after which the land is sold and the
proceeds are paid to the bene#ciary%
- The title to the property is transferred to the trustee usually for the bene#cial interest
of the trustor when the trustor also names himself the bene#ciary%
- The bene#cial interest in the land trust is legally classi#ed as personal property
rather than real property, but the bene#ciary is still entitled, to control and to possess
it, and is entitle to any income or to proceeds of its sale%
- bene#ts to a land trust1
3% 9ecause the deed is in the trustees name, the name of the bene#ciary does
not appear, so the bene#ciary can maintain secrecy as to actual ownership%
4% The bene#ciarys beneft can be assigned to someone else without a new
deed, and
5% can be used as collateral for a loan, but without a mortgage being recorded

Real Estate Ownership by 'usiness Entities
- .orporations - are legal persons so they can hold title to real estate
- :artneships -
- Real Estate $yn"icate - 4 or more people or business entities that have pooled their
money to invest in real estate% - oint (enture - similar e-cept that it is created for a speci#c
business purpose for a de#nite amount of time%
((( /eal $state ;yndicate and <oint =enture entities cannot hold title to real estate,
e-cept as tenants in common or *oint tenants of the individual members of the
syndicate or *oint venture, or as a trust, partnership, or corporation%