You know the basics—a title is the legal representation of property rights. It’s what gives you the right to use and enjoy your property. But did you know there are other ways to hold title in real estate?
While it is relatively common for a property to have a single owner, other ownership structures exist. There are cases in which various individuals or entities hold title to the same property. It can be through joint tenancy, tenancy by entirety, tenancy in common, and community property.
This article will discuss three other ways to hold title to a property.
A corporation can own real estate. Under this scenario, the legal entity is a company owned by shareholders but recognized as existing independently of them.
Corporations can own property and do business the same way as a person or group. That means corporations can hold property in a way that is similar to a person holding property.
Another way of holding title to real estate is through a partnership. A partnership is when two or more people decide they want to own property together. However, there are different types of partnerships – general or limited.
It is not uncommon for limited partnerships to form solely to own real estate. This situation involves investors taking limited responsibility since they are not involved in management or transaction decisions. For these partnerships, one general partner typically makes all business decisions on behalf of the limited partners.
When you own real estate through a trust, the trust owns the property, and a trustee manages it on your behalf. Trusts can be advantageous in some situations but can also come with challenges.
Real estate held in a trust can raise complex issues related to managerial influence, financial liability, and tax considerations. You need to weigh the advantages and disadvantages of a trust before forming one to hold property. It is best to consult with a lawyer when planning a trust.
So there you have it. We hope this article has given you a good overview of the different ways to hold a title. As you can see, ownership can take many forms.
Do you need to close your escrow professionally in the Knoxville area on time? We’d love to help you! Please click here for our contact page, and we’ll reach out to you promptly.
Thanks for visiting!