Deeds – Property Ownership
Sole Ownership
Property Ownership – Deeds – Sole ownership is defined to mean ownership by one person. Being the sole owner, one person enjoys the benefits of the property and is subject to the accompanying burdens. This can include the payment of taxes. Subject to applicable federal and state law, a sole owner is free to dispose of property at will. Typically, only the sole owner’s signature is required on the instrument of transfer/deed of conveyance. See Civil Code Section 681.
Joint, Common, or Community Ownership
Joint, common, or community ownership or co-ownership means simultaneous ownership of a given piece of property. Owned by several persons (two or more). See Civil Code Section 682. The types of such ownership interests include the following:
Tenancy in Common
Tenancy in common is a property ownership deed and exists when several (two or more) persons are owners of undivided interests in the title to real property. It is created if an instrument conveying an interest in real property to two or more persons does not specify that the interest is acquired by them in joint tenancy, in partnership, or as community property. Some instruments of transfer/deeds of conveyance clearly state the intentions of the persons acquiring are to hold title as tenants in common. See Civil Code Section 685. No right of survivorship exists for individual tenants when title is held as tenants in common.
The undivided interest of a deceased tenant in common passes to the beneficiaries (heirs or devisees) of the estate subject to probate, pursuant to the last will and testament of the deceased or by intestate succession. The heirs or devisees of the deceased simply take the tenant’s place among the other owners who continue to hold title to the property as tenants in common. See Probate Code Section 6400 et seq.
Joint Tenancy
Joint tenancy exists if two or more persons are joint and equal owners of the same undivided interest in real property. Generally, to establish a joint tenancy a fourfold unity must exist: interest, title, time, and possession. Joint tenants have the same interest, acquired by the same conveyance, commencing at the same time, and held by the same possession. See Civil Code Section 683.
The most important characteristic of a joint tenancy is the right of survivorship that flows from the unity of interest. The words “with the right of survivorship” are not necessary for a valid joint tenancy deed, although they are often inserted. If one joint tenant dies, the surviving joint tenant (or tenants) become(s) the owner(s) of the property to the exclusion of the heirs or devisees of the deceased. Thus, joint tenancy property cannot be disposed of by the last will and testament, is not subject to intestate succession, and typically does not become part of the estate of a joint tenant subject to probate.
Community Property
Community property generally consists of all property acquired by a husband and wife, or either, during a valid marriage, other than separate property acquired prior to the marriage, by gift, or as an individual heir or devisee of a deceased. Separate property may also include property designated as separate by the husband or wife or by court order. Separate property of either the husband or the wife is not community property.
TYPES OF DEEDS
Grant Deed
Property Ownership – Deeds – The grant deed is used when a person who is on the current deed transfers ownership or adds a new owner. The grantor (donor or seller) promises that all rights to the property are being transferred—there are no hidden owners or easements. Because of inclusion of the word “grant” in a grant deed, the grantor impliedly warrants that he or she has not already conveyed to any other person and that the estate conveyed is free from encumbrances done, made or suffered by the grantor or any person claiming under grantor, including taxes, assessments and other liens.
This does not mean that the grantor warrants that grantor is the owner or that the property is not otherwise encumbered. The grant includes appurtenant easements for ingress and egress and building restrictions. The grantor’s warranty includes encumbrances made during grantor’s, but no other individual’s, possession of the property. It conveys any title acquired after the grantor has conveyed the title to the real property (after-acquired title), generally. Observe that these warranties carried by a grant deed are not usually expressed in the grant deed form. They are called “implied warranties” because the law deems them included in the grant. Whether or not explicitly expressed in the deed.
Quitclaim Deed
Property Ownership – Deeds – A quitclaim deed is a deed by which a grantor transfers only the interest the grantor has at the time the conveyance is executed. The grantor is not promising anything other than that they are giving up their own rights, if any. There are no implied warranties in connection with a quitclaim deed. This type of deed guarantees nothing and there is no expressed or implied warranty that grantor owns the property or any interest in it. Moreover, a quitclaim deed does not convey any after-acquired title. A quitclaim deed effectively says, “I am conveying all the title that I have in the property described in this quitclaim. If I have, in fact, any title.”
A quitclaim deed is often used in divorces, when one spouse gives up any potential community property interest. In addition, a quitclaim deed is used to clear some “cloud on the title.” A “cloud on the title” is some minor defect in the title which needs to be removed in order to perfect the title. Deeds of court representatives, such as guardians, administrators, and sheriffs, usually have the effect of a quitclaim pursuant to court order.
Interspousal Deed
An interspousal deed is used between spouses or registered domestic partners (“DP”). For the purpose of changing real estate to or from community property. Spouses/DPs can use grant or quitclaim deeds to do the same things. But, the interspousal deed makes it clear that the transaction is intended to affect community property rights.
Trust Deed or Deed of Trust
A trust deed or deed of trust is never used to transfer ownership (not even to a trust). It is the functional equivalent of a mortgage. A trust deed is a three-party security instrument conveying title to land as security for the performance of an obligation. Like a mortgage, a trust deed makes a piece of real property security (collateral) for a loan. If the loan is not repaid on time, the lender can foreclose on and sell the property. Additionally, they can use the proceeds to pay off the loan. A trust deed is not used to transfer property to a living trust. Other than terminology, trust deeds and living trusts have nothing in common. A living trust is used to avoid probate, not to provide security for a loan.
Reconveyance Deed
A reconveyance deed is an instrument conveying title to property from a trustee back to the trustor-borrower. Once the money borrowed has been repaid to the lender.
Revocable Transfer on Death Deed
The revocable transfer on death deed is used to leave property to heirs without the need for probate. The grantor names the intended heirs as “beneficiaries.” The deed has no effect until the grantor dies, when the beneficiaries record an affidavit to receive the property.
OTHER TYPES OF RECORDED DOCUMENTS
Affidavit of Death of Joint Tenant
Property Ownership Deeds – The affidavit of death of joint tenant is used to remove the name of a deceased joint tenant from a property title. Affidavit of Death of Trustee is used when a successor trustee is named in a trust. They are the person who will take over the trustee’s duties and fulfill provisions of the trust when the trustee dies. The transition process requires trust property to be transferred out of the trustee’s name into the successor trustee’s name. To transfer property to the name of the successor trustee, a form called “Affidavit of Death of Trustee” should be recorded. It is done in the county where the property is located. A separate affidavit must be filed for each real property title held in the trustee’s name.
References Reference Book (2010),11 California Department of Real Estate, Chapters 5 and 7.
The Appraisal of Real Estate, Appraisal Institute, 14th edition.
Sacramento County Public Law Library
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