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Ways to Hold Title to Property in Maryland and the District of Columbia

Ways to hold title to property in Maryland and Washington, DC

For many people, real property, including their home, is a big part of their overall net worth. How the home and other pieces of real property is titled deserves careful consideration. Real estate constitutes the land and any structure, including vegetation, crops, and other natural resources that sit on the land under the state’s law. Real estate can be commercial or residentially owned. There are several ways to hold title to property in Maryland and the District of Columbia (DC), each with it’s own set of far-reaching consequences for liability, and when it comes time for sale or the bequeathing of it as an inheritable asset.

A Breakdown of the Ways to Hold Title to Property in Maryland and Washington, DC

The title is a reference to the document that lists the legal owner(s) of a piece of property and can depict ownership of both personal and real property. Real estate titles are regarded as real property as it is a tangible asset. The title for real property, by law, must be transferred if the asset is sold or inherited and must be clean for the title transfer to take place. A clean title is free of liens or any other encumbrance posing a threat to proper ownership. The most common ways to hold title to property in Maryland and DC are joint tenancy, tenancy in common, tenants by the entirety, sole ownership, and community property. Less common property ownership titles are corporate, partnership, and trust ownership. Below, we break down each of these ways to hold title to property in more detail.

Sole Ownership

Sole Ownership allows for a single person to hold title to real property, even if you are married. If the person becomes mentally or physically incapacitated due to injury or illness, a spouse or family member would be unable to conduct business with regards to the property solely held in mentally or physically incapacitated individual name. For example, your family member will not be able to conduct business transactions like refinancing the mortgage, applying for a home-equity lines of credit, or sell the property. In order for a spouse or family member to act on your behalf, they will have to petition a court of competent jurisdiction to appoint a guardian of property to act on your behalf. Many people assume if they have a Last Will and Testament it will address the problem, yet a Will does not go into effect until after you die and is not in effect if you become incapacitated.

Joint Tenants

Another one of the ways to hold title to property is as Joint Tenants (some may have rights of survivorship), which occur when two or more people hold title to real estate jointly. This type of title is widespread among, but not exclusive to married couples. Unmarried couples may also hold joint tenant title, as can parents and their adult children. There is no requirement for a familial relationship or a spousal relationship in order to hold title as joint tenants. In the cases where title is held as Joint Tenants with the Rights of Survivorship, the death of one joint tenant automatically transfers full ownership to the surviving joint tenant without probate. However, probate is more than likely just to be postponed. In the event the surviving owner dies without adding another owner, or if both owners die at the same time, probate is almost certain to occur before the property can go to the heirs.

Being a co-owner means that to sell, refinance, or take any action to the property, both owners must agree to the business action. If there is disagreement or in the event your co-owner becomes incapacitated, the court will become involved to resolve the disagreement or to protect the interest of the one who has become incapacitated. Court involvement will occur even in the event the incapacitated owner is your spouse. Joint tenancy also exposes the property to both of the co-owner’s obligations and debts. If a creditor successfully sues your co-owner, you could lose your home. In the case a co-owner is not a spouse, there can be income tax or gift tax problems. A Last Will and Testament does not control any jointly owned assets, and you may mistakenly disinherit your family when your co-owner inherits your share, particularly in the case of second marriages with children from a previous union.

Tenants in Common

Tenants in Common (TIC) allows for two or more people to hold title to real estate with equal rights during their lifetime to enjoy the property. A tenant in common title creates shares of ownership, and those shares will be distributed as directed in a Last Will and Testament upon an owner’s death. In the absence of a Will, the property goes to the heirs of the owner. As a tenant in common, you individually hold title for a respective part of the property, you are at liberty to dispose of said owned property or encumber it at will. Owners of their respective shares are permitted to use their portion of the property as collateral or in financial transactions. They may also be sued or have creditors place liens on only their portion of the property.

Tenants by the Entirety

Tenants by the Entirety (TBE) are only permissible if the owners are legally married. This title, for purposes of ownership, treats the couple as one person for legal action and interpretation. Upon the death of one person, the TBE title is transferred in its entirety to the other spouse. This is advantageous as no legal action is necessary upon the death of one’s spouse. It does not require a Last and Will and Testament to bequeath and probate is unnecessary.

Corporate Ownership

Corporate Ownership allows a legal entity, valid under state law, to hold title to property. For example, a limited liability company (LLC) or limited lability partnership (LLP), valid in any jurisdiction can hold tittle to property in Maryland and the District of Columbia.

Trust Ownership

Trust Ownership, most often in the format of a revocable living trust, is a legal entity that owns property, which is managed by trustmaker or designated trustee on behalf of all trust beneficiaries. In the event you become incapacitated, your named successor trustee can seamlessly take control of your trust without court interference. The successor trustee is legally obligated to follow the instructions put forth in the trust document. If you recover from incapacitation, you resume control of your trust. Upon your death, the property would be distributed according to your trust instructions – without probate. Holding real estate in trust has challenges regarding benefits that surround financial and legal liability, managerial influence, and tax considerations. Holding real estate in trust can provide significant advantages to property owners, but only if the trust document was drafted by competent estate planning attorney who take into account the complexities surrounding the trust and its interaction with the liabilities listed.

McDonald Law Firm is here to help.

Methods of holding and owning title to real estate property are determined by state law and, as such, must be considered when researching and determining the best method to acquire, and ways to hold title to property. Depending on the complexity of your situation, assessing the best way to title your real estate may require professional legal and tax guidance. At McDonald Law Firm, we help clients determine the best ways to hold title to property, and whether a trust would be beneficial. Give Andre O. McDonald, a knowledgeable Howard County, Montgomery County and District of Columbia estate planning, special-needs planning, veterans pension planning and Medicaid planning attorney a call at, (443) 741-1088 or (301) 941-7809 – we would be happy to help.


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For help with estate planning, special needs planning, elder law or Veteran's Pension Planning needs throughout Howard, Montgomery, Prince George’s, Anne Arundel, and Baltimore County; and Baltimore City, contact McDonald Law Firm, LLC.

McDonald Law Firm, LLC

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Columbia, MD 21044-3563

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Bethesda, MD 20814

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