Title Real Estate Correctly for Asset Protection

Real Estate Title Considerations When Purchasing

It is important to title real estate correctly when purchasing it with an unmarried individual or not jointly with immediate family members. A real estate title is the legal proof of ownership for a property, and errors in titling can lead to issues in the future. Title insurance may also be affected by incorrect or improper titling.

Real Estate Title & Ownership

When purchasing real estate with an unmarried individual, it is important to consider how the property will be titled. This can have significant implications for both parties involved. There are several options for titling real estate:

1) Sole Ownership: In this scenario, one person holds full ownership of the property. This is typically used when an individual purchases a property on their own or when they inherit a property.

2) Tenancy in Common: When two or more individuals purchase a property together but hold unequal shares, they may choose tenancy in common as their method

Costly Inheritance Tax Risks – Real Estate Titles            

Very difficult circumstances can arise if unmarried individuals own real estate together and the relationship deteriorates such that ownership interests must be determined, and the property sold.  In addition, the unexpected death of an individual holding title to the real estate with you can lead to a Pennsylvania Inheritance Tax calculated at a 15% tax rate.

Deeded Interest – Titles in Real Estate

An “Unwritten Understanding” is typically not enforceable as to ownership.  Any understanding as to your intentions regarding the real estate should be put into a Written Understanding by Will and/or Agreement.  The Statute of Frauds in Pennsylvania requires that real estate transfers and ownership be documented by formal written Agreement, more preferably, by Deeded interest.

It is always important to have formal written Agreements to document real estate ownership or interests, particularly if an individual is not to be named on the recorded Deed for the real estate.     

Get Professional Help With Your Real Estate Title

The attorneys at Pyfer Reese are here to advise and assist you in the preparation of the appropriate documentation and written Agreements.  Contact us at 717-299-7342 to schedule a convenient appointment at our Lancaster, Willow Street, or Ephrata Office.

DISCLAIMER: Disclaimer:

The content presented in this article/blog is intended solely for informational purposes and does not constitute legal advice or guidance. It is essential to understand that this information is general in nature and should not be relied upon as legal direction. For personalized legal advice pertinent to your specific circumstances, we strongly encourage booking a consultation with one of our experienced professionals. Pyfer Reese Straub Gray & Farhat, PC and its team members expressly disclaim any liability for actions taken or not taken based on the information provided in this article.

Posted in News on by Pyfer Reese.