Holding Title of Real Estate in California

There are now 5 common ways to hold title in California when more than one person is holding title. In July of 2001 the 5th way was made law and added to the choice. Although it is strongly advised for anyone purchasing property in California to seek legal and tax guidance before deciding, here are 5 ways of holding title and the general features of each. Sole Ownership( simplest form of holding title ), Sole and Separate and Titles held in Trust and other ways of holding title will not be presented here.

The common ways  to hold title are:                                  

1. Tenants in Common
2. Joint Tenants
3. Community Property
4. Community Property with Right of Survivorship
5. Partnerships

The general features of each one:

Tenants in Common

• simple form of holding title
• equal or unequal interests
• each owner has separate title to undivided interests
• individual interest can be conveyed
• interest may be willed

Joint Tenants

• ownership may exist with multiple owners
• interests are equal
• individual owners do not have separate title
• individual interest may be be conveyed but doing so breaks the Joint Tenancy
• on death, joint tenant interest conveys to remaining joint tenants ( Right of Survivorship)

Community Property

• applies only to husband and wife on property conveyed after marriage
• interests are equal
• spousal interests may not be conveyed separately
• on death 1/2 of property passes by will
• probate required
• basis stepped up to fair market value

Community Property with Right of Survivorship

• Effective in California July 1. 2001
• ownership interests equal
• spousal interest passes automatically to surviving spouse
• applicable to conveyances after July 1, 2001
• title held as Community Property may be re-conveyed by married couple to change form of holding title.

Partnerships

• association of two or more individuals
• requires formal written partnership agreement to govern rights and responsibilities
• title held in name of partnership
• no conveyance by one partner without written consent of all the other partners

                                                                Subscribe to this blog

Setting the Parameters for Buying a New Home

When discussing with your agent what kind of home you want and what areas you will consider, be sure not to be so rigid as to miss some of the great possibilities in the market.

Getting Pre-approved for your home loan is one of the first things on your list. Knowing in advance how much home payments will be ( be sure to factor in the property taxes, insurance and a reserve for upkeep ) for the home price range within your means will help you stay realistic in your search.

If you are a First Time Home Buyer this is essential.

If you are a Move Up Buyer, when comparing your current costs to your projected  new home costs, be sure to also consider costs associated with re-decorating or landscaping, the added maintenance, increase in property taxes, utilities , etc. Once you have worked out your budget be sure to share this with your agent and they can help you adjust your budget to achieve your goals. The agent may be able to find ways to offset some of your new projected costs that might even provide you with a better fit in the new home selection. Sellers also may be able to help offset some of these with credits that will make their home a better fit overall