{"id":966,"date":"2020-08-24T06:00:43","date_gmt":"2020-08-24T10:00:43","guid":{"rendered":"https:\/\/www.deeds.com\/articles\/?p=966"},"modified":"2024-04-25T23:20:29","modified_gmt":"2024-04-26T03:20:29","slug":"lgbt-and-real-estate-ownership","status":"publish","type":"post","link":"https:\/\/www.deeds.com\/articles\/lgbt-and-real-estate-ownership\/","title":{"rendered":"LGBT+ and Real Estate Ownership"},"content":{"rendered":"\n

Navigating Mortgages, Titles and Deeds<\/em>
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Co-buying a home as a couple signifies a serious commitment\non multiple levels. If you have spoken with your real estate lawyer and financial\nexpert, and decided to buy property together as a couple, congrats! You\u2019ll want\nto make informed decisions about financing and titling your property together.\nYou\u2019ll be forging an estate plan as you go \u2014 because the way ownership is vested\non the title tells the world what should happen with your property ownership even\nbeyond your life. <\/p>\n\n\n\n

It\u2019s good to know that the language of the chain of title\ncan co-exist with respect for the homeowners\u2019\nsexual identity<\/a>. Even so, certain things will be on LGBTIQ home buyers\u2019 radar.\nHere, we outline some frequently noted issues, to help orient your\nconversations with your financial and legal advisers, and your mortgage and\ntitle professionals. <\/p>\n\n\n\n\n\n\n\n

How to Hold the Title in the Home You Buy Together<\/h2>\n\n\n\n

As co-owners, you\u2019ll want to vest\nyour home title<\/a> with the right information, helping you meet your planning goals\nand protect your interests, both individually and as a couple. You might vest\nthe property as:<\/p>\n\n\n\n

Joint Tenancy with the Right of Survivorship<\/h3>\n\n\n\n

Co-owners who select this vesting type own the property in\nequal shares. They can be married or unmarried. If one partner dies during the co-ownership,\nthe home does not get stuck in probate, where it could be challenged (the very\nword probate means the validity of the will is being proved). With a joint\ntenancy with a right of survivorship, by law, the interest of the deceased\npartner is simply extinguished, so the surviving partner will own the entire\nproperty. <\/p>\n\n\n\n

Tenants in Common<\/h3>\n\n\n\n

Tenants in common could also be married or unmarried. This\nis a flexible vesting option. The partners may hold different percentages of\nthe property if they wish, so Joe might own 80% while Bert owns 20%, though\nthey both use the entire space together.\nThey may each transfer or will their individual interests to each other,\nor to other people \u2014 even without permission of the other owner.<\/p>\n\n\n\n

This could be the best option if the owners want to pay\nunequal amounts into the monthly mortgage and other household expenses. (While\nboth co-owners are not legally required to be on the mortgage, lenders\ntypically expect to put both names on the agreement.) Be aware, though, that if\none owner dies during the co-ownership, the home won\u2019t automatically vest in the\nsurviving owner. Have a lawyer draft a will or transfer\non death deed<\/em><\/a> to protect the survivor\u2019s interest.  <\/p>\n\n\n\n

Tenancy by the Entirety<\/h3>\n\n\n\n

Today, all legally married couples, same-sex couples\nincluded, may title their home as a tenancy by the entirety. In some states it\nis the default for spouses. It might be available to domestic partners, depending\non state law. <\/p>\n\n\n\n

Tenancy by the entirety exists as a vesting category in Arkansas<\/a>, Florida<\/a>, Mississippi<\/a>, Missouri<\/a>, Oklahoma<\/a>, Oregon<\/a>, Tennessee<\/a>, and a number of other states. Is yours among them? Check your current state code to see what is available to you. Real estate laws change, and state lawmakers can and do establish or abolish tenancy by the entirety for property deeds. <\/p>\n\n\n\n

Where available, \u201cTBE\u201d is a highly protective vesting\nchoice. It shields the home from one owner\u2019s creditors \u2014 unless the creditor is\nthe IRS, or unless both owners took on the debt as a couple. When one owner\ndies, the other safely owns the property. Only after the surviving partner dies\n(or if both die at once) will the home go through probate. Neither owner may\ntransfer an interest in the home to a third party. <\/p>\n\n\n\n

Note:<\/em><\/strong>Some state codes<\/a> still use the \u201chusband and wife only\u201d language. Same-sex couples should work with a lawyer to draft title language that cements their intent to vest as tenants by the entirety.<\/p>\n\n\n\n

Community Property<\/h3>\n\n\n\n

Some couples buy real estate in community property states,\nwhere property (and debt) acquired during a marriage\nor life partnership belongs to both people together. We\u2019ll cite California\nas a prominent example. For heterosexual or same-sex couples in California, the\nlaw presumes that couples buying homes are buying community property. They may opt\nto hold it specifically as community property with a right of survivorship<\/em>,\nor they may decide to vest with another form of co-ownership.<\/p>\n\n\n\n

If one passes away during the home ownership, the survivor gets\na stepped-up cost basis of the property \u2014 an important tax advantage. <\/p>\n\n\n\n

Eligible same-sex couples in California are those in a\nlegally acknowledged relationships, including: <\/p>\n\n\n\n