What You Have to Know about Real Estate Form Ownerships

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If you are planning to buy or sell real estate, then it is important that you should know that ownership of the property is transferred upon sale.  There are a lot of forms of real estate property ownership, having its own defined rules and expectations. It is important to have a clear understanding of each real estate ownership type.  This ensures that transactions between buyers and sellers are made clear and are planned accordingly.  

Sole Ownership

This is the most easily identified form of properly ownership.  In this form, one individual is given the complete rights of a real estate property.  This is usually termed when only one person owns a piece of property or real estate. 

Tenancy by the Entirety

This is a form of real estate ownership in which a married couple owns or purchases a piece of property or real estate.  Each party has the legal right to own a property undivided.  This is intended so that in the event of one party, the remaining spouse is entitled to the other’s share.  No separate party has the right to sell a property without the other’s consent and approval.  This is done to prevent any forms of misuse from one party of a piece of real estate property.  

Tenancy in common

In this type of ownership, there are multiple individuals who own a piece of real estate property.  Although the percentages of ownership may vary, all of them have a legal right to use the property equally. Even if you have a higher percent of ownership, you can’t prevent someone from using that property.  When one owner dies, the rights to the property go to their heir and not to the other owners. This type of ownership can last several lifetimes from generation to generation

Joint tenancy

In this type of real estate ownership, important conditions must be complied to and met.  First, ownership of a property must be received by all tenants at the same time. Tenants will have equal interests in the property.  Furthermore, all tenants must be placed in the property title.  And lastly, all tenants should have equal rights o f possession to the property.  But in this case, tenants have a right to survivorship, meaning that when a tenant dies, his/her part of the property will be divided equally to the remaining tenants.  On the other hand, if one tenant sells his/her part to another tenant, then the ownership will turn into a tenancy in common. And the right to survivorship becomes invalid. 

Community property

In this set-up, ownership of a property is created through marriage.  All properties owned by both parties before marriage will become a joint property. In this case, both have equal rights to the property.  In cases of divorce or separation, the properties will have to be divided equally to both parties.  The right to survivorship may apply.  In some cases, a property may be passed down to an heir during death.  

 

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