What is Title and How to Hold it

Title to a property is the legal way of saying you own the property, and there are several ways to hold title to a property. Each method has its own legal and financial implications, so it's important to carefully consider the options and consult with a real estate attorney and/or financial advisor to determine the best choice for your specific situation. Below are the different ways title can be held in California. 

1. Sole Ownership: Sole ownership is exactly as it sounds - one person holds the title to the property. This is a common way for single individuals to hold title to their property. It provides the owner with complete control over the property and allows for easy transfer of ownership through a will or trust.

2. Joint Tenancy: Joint tenancy is a form of property ownership in which two or more individuals hold equal shares of the property with the same deed at the same time. When one owner passes away, their share of the property automatically transfers to the surviving owner(s) without the need for probate. This is a common way for married couples to hold title to their property.

3. Tenancy in Common: Tenancy in common is another form of property ownership in which two or more individuals hold unequal shares of the property with different deeds. Each owner can sell, mortgage, or transfer their share without the consent of the other owner(s). When one owner passes away, their share of the property is passed on to their heirs through their will or trust.

4. Community Property: Community property is a form of ownership that is recognized in some states, where property acquired during a marriage is considered to be owned equally by both spouses, regardless of which spouse's name is on the title. Since all such property is owned equally, both parties must sign all agreements and documents transferring the property or using it as security for a loan. Each owner has the right to dispose of his/her one half of the community property, by will.

5. Community Property with Rights of Survivorship: This form of holding title shares many of the characteristics of community property but adds the benefit of the right of survivorship similar to title held in joint tenancy. There may be tax benefits for holding title in this manner. On the death of an owner, the decedent’s interest ends and the surviving spouse owns the property. 

6. Trust: Property can also be held in a trust, where the legal title is held by the trustee for the benefit of the beneficiaries. This method allows for flexibility in managing and distributing the property, often avoiding the probate process and providing privacy in the transfer of ownership.

Less Common Ways to Hold Title:

7. A Corporation*: A corporation is a legal entity, created under state law, consisting of one or more shareholders but regarded under law as having an existence and personality separate from such shareholders.

8. A Partnership*: A partnership is an association of two or more persons who can carry on business for profit as co-owners, as governed by the Uniform Partnership Act. A partnership may hold title to real property in the name of the partnership.

9. Limited Liability Companies (LLC)*: This form of ownership is a legal entity and is similar to both the corporation and the partnership. The operating agreement will determine how the LLC functions and is taxed. Like the corporation its existence is separate from its owners.

*In cases of corporate, partnership, LLC or trust ownership - required documents may include corporate articles and bylaws, partnership agreements, LLC operating agreements and trust agreements and/or certificates.

It's important to note that the best way to hold title to a property depends on various factors such as individual circumstances, tax implications, estate planning, and asset protection. Therefore, it is crucial to seek the advice of a qualified real estate attorney and/or financial advisor to fully understand the legal and financial consequences of each option. The method of holding title to a property is a significant decision that can have long-term legal and financial implications. It's essential to carefully consider the options and seek professional advice to ensure that the chosen method aligns with your specific goals and circumstances.