Real property may be owned by a sole owner, or it may be owned concurrently by two or more persons. The types of concurrent ownership, explained below, are: (1) tenancy in common; (2) joint tenancy; (3) community property; (4) community property with Right of Survivorship.
Tenancy in Common
In tenancy in common, each owner’s interest in the property may be any fraction of the whole. Thus one party may own one-tenth, another three-tenths and a third party may own the remaining three-fifths. There is no right of survivorship; each “tenant in common” owns a defined interest, which upon his/her death, passes to that owner’s heirs.
Joint tenancy exists when two or more persons are joint and equal owners of the same, undivided interest in a specified property. The main characteristic of a joint tenancy is the right of survivorship. When a “joint tenant” dies, their interest in the property is terminated and the estate continues in the name of the survivor.
In general, community property refers to everything that two souses own together. So when title to a house is taken as “community property,” it means that the spouses own the house together, with no division of interest. Persons who are not married to each other cannot hold community property together.
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Community Property with Right of Survivorship
An act passed in 2001 allowed married couples in California to own real and personal property in a new form of holding title: “Community Property with Right of Survivorship.” The act also provided that the community property of two spouses, when expressly declared in the transfer document to be community property with right of survivorship, shall pass to the surviving spouse without having to first pass through the administration of the estate (probate). This form of ownership provides the best tax treatment of property in the event of death of a married person, and is the primary reason the statue was enacted.