Title is the evidence that you own your home. How you “hold title” refers to the various forms of ownership, each with different rights and obligations. Here are brief descriptions of the customary ways to hold title.
Sole Ownership: You alone own all interest in the home. If you’re married, your spouse is usually asked to formally give up ownership claim by signing a “quit claim deed”.
Joint Tenancy: Two or more people hold title to the home together. Each owns the home as a whole and has a right to equal use of it. With rights of survivorship, when one joint owner dies, that person’s interest automatically transfers to the remaining living co-owner, rather than to heirs named in a will.
Tenancy in Common: Each of the owners can have either equal or unequal interest. Each owner can use the entire property. When one joint owner dies, that person’s interest transfers to heirs named in a will.
Tenancy by the Entirety: A few states have this special form of joint tenancy for husbands and wives. They hold title together, but neither can take independent action to create an ownership claim or lien on the home. Upon the death of either, the other gets full title to the property.
Community Property: New Mexico, Arizona, California, Idaho, Louisiana, Nevada, Texas, Washington, and Wisconsin have community property laws for real estate owned by a married couple. Each spouse has a half interest in the property with certain rights. Each state has its own laws, so be sure to check the provisions if you’re married and purchasing in one of these nine states.
How you hold title has serious legal implications. So consult with an attorney for all of the details on your current and future rights for each way to hold title. Then select the type of ownership that’s best for you.
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