Advantages & Limitations -
Title to real property in California may be held by individuals, either in Sole
Ownership or in Co-Ownership. Co-Ownership of real property occurs when title
is held by two or more persons. There are several variations as to how title
may be held in each type of ownership. The following brief summaries reference
eight of the more common examples of sole ownership and co-ownership.
- A Single Man/Woman: A man or woman who is not legally married. Example: John
Doe, a single man.
- An Unmarried Man/Woman: A man or woman, who is legally divorced. Example:
John Doe, an unmarried man.
- A Married Man/Woman, as His/Her Sole and Separate Property: When a married
man or woman wishes to acquire title in his or her name alone, the spouse must
consent, by quitclaim deed or otherwise, to the transfer thereby relinquishing
all right, title and interest in the property.
- Community Property: The California Civil code defines community property as
property acquired by husband and wife, or either, during marriage, when not acquired
as the separate property of either. Real property conveyed to a married man or
woman is presumed to be community property, unless otherwise stated. Under community
property, both spouses have the right to dispose of one half of the community
property by will, but if there is no will, all of the property will go to the
surviving spouse without administration. If a spouse exercises his/her right to
dispose of one-half, that half is subject to administration in the estate. Example:
John Doe & Mary Doe, husband and wife, as community property. Example: John
Doe & Mary Doe, husband and wife. Example: John Doe, a married man.
- Joint Tenancy: A joint tenancy estate is defined in the Civil Code as Follows:
"A joint interest is one owned by two or more persons in equal shares, by
a title created by a single will or transfer, when expressly declared in the will
or transfer to be joint tenancy." A chief characteristic of joint tenancy
property is the right of survivorship. When a joint tenant dies, title to the
property immediately vests in the surviving joint tenant(s). As a consequence,
joint tenancy property is not subject to disposition by will. Example: John Doe
and Mary Doe, husband and wife, as joint tenants.
- Tenancy In Common: Under tenancy in common, the co-owners own undivided interests
but, unlike joint tenancy, the interests need not be equal in quantity or duration,
and may arise at different times. There is no right of survivorship; each tenant
owns an interest which on his or her death vests in his or her heirs or devisee.
Example: John Doe, a single man, as to an undivided 3/4ths interest, and George
Smith, a single man, as to and undivided 1/4th interest, as tenants in common.
Trust: Title to real property in California may be held in a title holding
trust. The trust holds legal and equitable title to the real estate. The trustee
holds title for the benefit of the trustor/beneficiary who retains all of the
management rights and responsibilities.
Community Property with Right of Survivorship: This has the
same attributes as the traditional community property form of title but, like
joint tenancy, has the additional attribute of the right of survivorship. When
a husband and wife hold title as Community Property with Right of Survivorship
the full interest in the property will vest, by law, in the surviving spouse
immediately upon the death of the first spouse.
NOTE: The preceding is provided for informational purposes
only. For a more comprehensive understanding of the legal and tax consequences,
appropriate consultation is recommended. There are significant tax and legal
consequences on how you hold title.
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