How Should You Own Your Property?

 

 

What Is the Best Way to Hold Your Property?

Transcript:

Jordan: I’m Jordan Flake with Clear Counsel Law Group. I’m an attorney who does estate planning primarily. Occasionally, questions will come up about how property ownership works and operations of law. What I mean by that is how do you hold property in such a way that it will accomplish some of your estate planning objectives? We call this non-attorney estate planning, usually because it doesn’t necessarily require an attorney.

When you purchase a house, you can just tell your real estate agents and the title company how you want to take title to that property. Let’s just use the example of a client who said, “My wife and I and a friend own this duplex together, the three of us. We want to make it so that the last of us to die, the survivor among the three of us, gets all the property?” They don’t necessarily have to go see an attorney to make that happen. They can just tell the title company that they’d like to own the property in joint tenancy with rights of survivorship

What that means is that everybody just owns the property and then the survivors own the property and then the survivor of the survivors gets all the property. That’s called joint tenancy with rights of survivorship. Now there are other ways to own it. There’s something called tenancy in common, which means each would get one-third, one-third, one-third and their undivided one-third share would go to their estate when they passed away.

 

property, estate planning, Las Vegas, Nevada

 

That wouldn’t accomplish the objectives of which they were requesting from me. Normally, a better way to do all of this is to put it all into a trust because then you can clearly delineate who gets what and when and under what circumstances. Brian, do you have any questions on this form of ownership?

 

Brian: Is it difficult to change the ownership from a joint tenancy to a tenancy in common?

 

Jordan: You can do that just by recording a deed. We can help you prepare the deed that would change the vesting status, it’s called vesting status meaning what happens when a person passes away, but we can prepare a deed that will change the vesting status and we don’t charge much to do that. In fact, we don’t charge at all for the consultation. Any other follow-up questions on this though?

 

Brian: Of the options you described, you said that a trust is preferable to just having it recorded on the deed.

 

Jordan: When you prepare a trust, you also prepare a deed, generally transferring the property into the trust. A trust operates like a box, then you can put property inside that box. The house or the duplex in this case would be something that you’d likely want to deed into the trust. Then the trust gives specific instructions about what happens to that property. Say the husband and wife pass away, but their friend at that time is an elderly gentleman, who’s incapacitated just because of old age.

The trust will prepare for that contingency, whereas merely creating a deed that puts the house into joint tenancy with rights of survivorship doesn’t address that contingency. A trust is much more comprehensive and flexible in terms of addressing several different possible scenarios. That’s what we do as estate planning attorneys. We look out and say, “How can we preemptively address all of these things that can and do happen to people?” That’s why it’s really important to set up a consultation with me. I don’t charge for the initial consultation. I’d be happy to go over this or any other situation that you’re looking at. Thank you.

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