Chapter 6 - Forms of Ownership

Living Trust

- An agreement where the trustee holds the legal possession of an asset (e.g. real estate) that belongs to another person, the beneficiary, and it is created while the person is alive.

Limited Liability Company [LLC]

A business structure that combines the pass-through taxation of a partnership or sole proprietorship

Partition

A division of real or personal property or the proceeds therefrom among co-owners.

Time-Share

A form of subdivision of real property into rights to the recurrent, exclusive use or occupancy of a lot, parcel, unit, or segment of real property, on an annual or some other periodic basis, for a specified period of time.

Land Trust

A legal agreement where a trustee is appointed to maintain ownership of a piece of real property for the benefit of another party

Trust

A legal relationship under which title to property is transferred to a person known as a trustee.

Trustor

A person who holds title to property for the benefit of another called a beneficiary

Trustee

A person who holds title to the property for another called a beneficiary

Testamentary Trust

A trust which arises upon the death of the testator, and which is specified in his or her will.

Unity of Possession

All co-owners must have the right to possess or access all portions of the property

Cooperative

An apartment building, owned by a corporation and in which tenancy in an apartment unit is obtained by the purchase of shares of stock of the corporation and where the owner of such shares is entitled to occupy a specific apartment building.

Partnership

An arrangement in which two or more individuals share the profits and liabilities of a business venture.

Corporation

An entity established and treated by law as an individual or unit with rights and liabilities, or both, distinct and apart from those of the persons composing it. A corporation is a creature of having certain powers and duties of a natural person. Being created by law, it may continue for any length of time the law prescribes.

Condominium

An estate in real property wherein there is an undivided interest in common in a portion of real property coupled with a separate interest in space called a unit, the boundaries of which are described on a recorded final map, parcel map or condominium plan. An owner owns an interest in a single apartment/unit, and a shared interest in the common areas of the building. Is considered REAL PROPERTY. Each unit owner receives a DEED at closing. OWNER A - OWNER B - OWNER C: Each owns their own particular unit

Real Estate Syndicate

An organization of investors usually in the form of a limited partnership who have joined together for the purpose of pooling capital for the acquisition of real property interests.

Unity of Interest

Co-owners have an equal percentage of ownership

Unity of Title

Co-owners have the same type of ownership

Unity of Time

Co-owners of a home receive title at the same time in the same conveyance.

Tenancy in Common

Co-ownership of property by two or more persons who each hold an undivided interest, WITHOUT the right of survivorship Owner A - Owner B: own a property together as a TENANCY IN COMMON Owner B's Heirs: If Owner B passes away, OWNER B's interest in the property will be transferred to his/her heirs, rather than OWNER A

Tenancy in Common

Co-ownership of property in which each party owns an undivided interest that passes to his or her heirs at death.

Proprietary Lease

Cooperative owners are allowed to occupy their apartment unit

Shares of Stock

Cooperative owners do not own their apartment unit, or the cooperative building itself, but instead own SHARES OF STOCK in the corporation that owns the cooperative building.

Tenancy by the Entirety

Ownership of property acquired by a husband and wife during marriage. The property is equally and jointly owned, with the right of survivorship. Married couples.

Community Property

Property acquired by husband and/or wife during a marriage when not acquired as the separate property of either spouse. Each spouse has equal rights of management, alienation and testamentary disposition of community property.

Severalty Ownership

Real property that is owned by only one person. Sole ownership.

Common Elements

Refers to the spaces in a building shared by residents of the building. These include lobbies, corridors, stairs, elevators, etc.

Beneficiary

The lender on the security of a note and deed of trust

Right of Survivorship

The right of a surviving tenant or tenants to succeed to the entire interest of the deceased tenant.

Right of Survivorship

The right of a surviving tenant or tenants to succeed to the entire interest of the deceased tenant; the distinguishing feature of a joint tenancy.

Tenancy By the Entireties

Under certain state laws, ownership of property acquired by a husband and wife during marriage, which property is jointly and equally owned. Upon death of one spouse it becomes the property of the survivor.

Joint Tenancy

Undivided ownership of a property interest by two or more persons each of whom has a right to an equal share in the interest and a right of survivorship, i.e., the right to share equally with other surviving joint tenants in the interest of a deceased joint tenant.

Joint Tenancy

Undivided ownership of a property interest by two or more persons, each of whom has a right to an equal share and a right of survivorship. OWNER A + OWNER B: Owner A and Owner B own a property together If OWNER B passes away, OWNER B's interest in the property will be transferred to OWNER A, rather than OWNER B's heirs.