It is getting hot and so it the market! This month’s lending tip discusses an extremely common question we receive from borrowers, how to take title. While we typically defer to the title company, it is valuable to know what the various ways are, as it has an effect on how you write the purchase contact.

Sole Ownership:
• Sole ownership may be described as ownership by an individual. Examples of common vesting in cases of sole ownership are: A Single Man or Woman (never married), An Unmarried man or Woman (single, divorced or widowed) or a married man/woman as his or her sole and separate property.

Co-Ownership – title to property owned by two or more persons:
• Community Property: (married couples only)- A form of vesting title to property owned by a married couple during their marriage which they intend to own together. Community property is distinguished from separate property, which is property acquired before marriage, by separate gift or bequest, after legal separation, or which is agreed to be owned by only one spouse.

• Community property with right of survivorship: A form of vesting to title owned by a married couple during their marriage which they intend to own together. Right of survivorship avoids probate. Mutual consent required for transfer. Decedent’s interest automatically passes to surviving spouse due to Right of Survivorship. Surviving spouse may have tax advantage.

• Joint Tenancy: Joint tenancy is a form of vesting title to property owned by two or more persons, who may or may not be married, in equal interest, subject to the right of survivorship in the surviving joint tenants. Title must have been acquired at the same time by the same conveyance, and the document must expressly declare the intention to create joint tenancy estate. When a joint tenant dies, title to the property is automatically conveyed by operation of the law to the surviving joint tenants. Therefore, joint tenancy property is not subject to disposition by will.

• Tenancy in Common: A form of vesting title to property owned by any two individuals in undivided fractional interests. The fractional interests may be unequal in quantity or duration and may arise at different times each tenant in common owns a share of the property is entitled to a comparable portion of the income from property and must bear equivalent share expenses. Each cotenant may sell, lease or will his/her heir that share of the property belonging to him/her.

• Trust: a full copy of the trust will be required and trust must be approved by PrimeLending Legal department. Additional conditions may apply.

Who Can Take Title?
• Tenancy in common – any number of persons. Can be married couple, must be legal age.
• Joint tenancy – Any numbers of persons. Can be married couple, must be legal age.
• Community property –Married couples only.
• Sole and Separate- Married individual only

QUICK TIPS:
1. Don’t open new debts while in contract
2. Don’t quit your job
3. Don’t deposit large amounts of cash into your bank account. Let me know if you have any questions and have a great rest of your month.

by Andrew Augustyniak Branch Manager
Prime Lending