Upon close of escrow home buyers must choose on how they are going to hold title on the Arizona home they just purchased. Below is a list of ways a home buyer can hold title in Arizona.
* Community Property – Requires two married people; each spouse holds an undivided one-half interest in the estate; one spouse cannot partition the property by selling his or her interest; upon death, the estate of the decedent must be “cleared” through probate, affidavit, or adjudication.
* Joint Tenancy with Rights of Survivorship – The parties involved do not need to be married; there can even be more than two joint tenants; each joint tenant holds an equal and undivided interest in the estate; one joint tenant can partition the property by selling his or her joint interest; no court action is needed to “clear” title upon the death of joint tenant(s).
* Community Property with the Right of Survivorship – Requires two married people; each spouse holds an undivided one-half interest in the estate; one joint tenant can partition the property by selling his or her joint interest; no court action is needed to “clear” title upon the first death.
* Tenancy in Common – The parties involved do not need to be married; there can even be more than two tenants in common; each tenant in common holds an undivided fractional interest in the estate, which can be disproportionate; each tenant’s share can be conveyed, mortgaged, devised to a third party; upon death, the estate of the decedent must be “cleared through probate, affidavit, or adjudication.
* Sole and Separate – A married person may take title as “sole and separate,” however, because Arizona is a community property state, his or her spouse must execute a disclaimer deed to avoid the presumption of community property.
*Corporation -Title may be taken in the name of a corporation provided that the corporation is duly formed and in good standing in the state of its incorporation.
*General Partnership – Title may be taken in the name of a general partnership duly formed under the laws of the state of the formation of the partnership. A partnership is defined as a voluntary association of two or more persons as co-owners in a business for profit.
*Limited Partnership - A partnership formed by two or more persons under the laws of Arizona or another state and having one or more general partners and one or more limited partners. A certificate of limited partnership must be filed in the Office of the Secretary of State, a certified copy of which must be recorded.
A great resource for more information on how to take title is your local Title company. First Arizona Title Agency has a staff of highly trained, top performing Escrow Officers who have proven themselves in our industry with many years of experience and thousands of successful closings. From complicated commercial closings to simple residential cash transactions, First Arizona Title’s reputation for experienced staff, combined with local market knowledge leads the industry.
The Arizona Residential Purchase contract states in Section 3b , “Taking title may have significant legal, estate planning and tax consequences.” with that said you should seek legal and tax advice from qualified professionals in order to determine how you should take title in a real estate transaction.
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