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

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