Options for How to Hold Title – The Vesting Form Explained

12 Feb Options for How to Hold Title – The Vesting Form Explained

Demystifying the escrow process for buyers is part of our goal here at CV Escrow.  One of the ways we accomplish this is by providing buyer’s a detailed opening package. This package contains a particular form called a Vesting Form that is integral to the escrow process and to the buyer’s future interest in the property. Simply put, it requires the buyer to outline how they will hold title to their new property.

The vesting of a title should be given special consideration because it specifies who is responsible for the costs, benefits, and transferability of a property. The value of real property is significant and with a little forethought, conflict can be avoided down the road with partners, creditors, spouses and/or heirs, as well as the Internal Revenue Service.

The most common forms of holding title include:

1. Sole Ownership

   1. As a single man or woman
   2. As a Married man or woman
   3. As a registered domestic partner, man or woman.

2. Co-ownership

   1. Community property, which is the presumed form for married couples. This entitles each party to equal parts of the property.
   2. Community property with rights of survivorship, which automatically transfers the property to the survivor in the face of a death.

3. Joint Tenancy

   1. This includes equal interests with rights of survivorship, but where the partners aren’t necessarily married.

4. Tenancy in Common

   1. In this form, the parties’ interests are broken up, and the costs and benefits are then divided as such.

It’s important to remember that the form of title that you choose has inheritance and/or tax implications. Your escrow officer at CV Escrow is more than happy to explain the differences between the various manners in which title can be held. However, it is beyond our scope to actually recommend what would be best for a buyer. For that, the buyer should consult an attorney, CPA or estate planner who is more familiar with the buyer’s specific situation.  Research and clear communication with one of these resources will help make the transaction a smooth success.