Washington state real estate law
An estate is an interest in land that is or may become possessor. In other words, the person who holds the interest currently has or may have in the future, the right to possess the property. The various types of estates can be distinguished by their duration and when they may be possessed. A present interest gives a person the right to immediate possession of the property. A future interest gives a person the right to possess the property only at some future data.
FREEHOLD ESTATES
Under the English feudal system, all land was owned by the king. The king parceled out land to his followers in return for certain services. These men often created sub tenancies by renting out persons of their properties. The modern American system that allows several different people to possess interests or estates in the same piece of property grew out of that feudal system. Many of the legal terms still used in discussing real estate came out of that system.
The term ?freehold? originally referred to the holdings of a freeman under the English system. A freeman was allowed to sell his rights in the property, as long as the new owner agreed to give the same services to the lord or king, who held a higher interest in the property.
In modern usage, a freehold estate may still be sold and unless specifically stated otherwise, the new owner acquires the same type of ownership held by the previous owner.
A freehold estate is a possessor interest in real property that is of uncertain duration, which means that the length of time of ownership is unspecified and indefinite. There are two main categories of freehold estates :
FEE SIMPLE ESTATES
Normally, when a person is referred to as the ?owner? of property, it is assumed that he or she holds a fee simple estate. A fee simple estate is the highest and best interest that can exist in land. A fee simple is always :
That an estate is inheritable means quite simply that it can be inherited, left to someone in a will or automatically passed to heirs upon death if there is no will. A fee simple estate is also freely transferable, which means that it can be sold, divided or even given away with no restrictions. Finally, a fee simple is perpetual, meaning that a person who holds a fee simple estate has the right to possess the property for an indefinite period of time. Since there is no specified termination date, a fee simple estate can theoretically be held forever by the titleholder or heirs.
The fee simple estate is divided into two sub categories :
Fee Simple Absolute. A fee simple absolute is essentially the same type of fee simple estate described above : inheritable, transferable and perpetual. In a typical sale of property, the real estate agent and the buyer assume that the seller holds a fee simple absolute title and that this same interest will pass to the new buyer. However, it is important to recognize that not every estate is a fee simple absolute. The grantor of property can qualify the estate being transferred and specify that it is not a pure fee simple absolute. Such qualifications create what are called fee simple defeasible estates.
Fee simple defeasible. When transferring property, the grantor may want to include certain conditions concerning the use of the property. As long as these conditions are met or a specified future event does not occur, the fee simple defeasible is also for an indefinite period of time, just like the fee simple absolute. However, a defeasible estate can be defeated or undone, upon the happening of the future event specified by the grantor.
There are two types of defeasible fees :
A fee simple determinable estate will automatically revert back to the grantor or the grantors heirs, if certain qualifications are not met. This type of estate is usually created by using the words ?so long as?, ?which?, ?during?, or ?until?.
A fee simple subject to condition subsequent is an estate that may revert back to the grantor if certain conditions are not met. The conditions are usually expressed with the words ?if?, ?provided that?, or ?on the condition that?.
CO-OWNERSHIP OF REAL PROPERTY
Ownership of real property is frequently shared by more than one person. Two, ten or two hundred people can own the same piece of property at the same time. This chapter explains the forms that concurrent ownership can take. The first section of the chapter focuses on the various ways in which co-owners can hold title, such as community property or tenancy in common. The second part of the chapter describes ownership by associations of two or more persons, such as partnerships.
Forms of Co-ownership
When property is owned by one individual, he or she holds title in severalty. In WashingtonState, when property is owned by more than one individual, they can hold title in one of three ways :
Many prospective co-owners are unaware of these various forms of co-ownership and wind up with one or another by default. However, the way in which title is held is very important, as it determines who controls the property. It can also have dramatic consequences when co-ownership ends, whether voluntarily or through dissolution or death. Co-owners need to understand these effects and deliberately choose the type of ownership they want.
Real estate agents should make sure that buyers realize the importance of the form of co-ownership. However, when an agent raises the subject, the buyers often ask for help in choosing how to take title. This is beyond the licensee?s area of expertise; at that point, he or she must advise the buyers to consult a lawyer. Even a well intentioned licensee who gives buyers friendly advice may end up charged with the unauthorized practice of law.
In addition, if the buyers make the wrong choice based on the agent ?s advice, the agent could be liable for damages.
Even though a real estate licensee should avoid advising buyers about forms of co-ownership, the licensee nevertheless needs at least a general understanding of the subject. Whenever a legal document is executed, the agent needs to know whether only one co-owner?s signature is sufficient or whether all the co-owners need to sign. For the parties, this can mean the difference between an effective sale and a void transaction. For the agent, it can mean the difference between a commission and a lawsuit.
COMMUNITY PROPERTY
Community property is one of the most common forms of co-ownership in this state. Outside of Washington, only Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas and Wisconsin have community property systems. In most other states, married couples co-own property as tenants by the entirety. Tenancy by the entirely is similar to joint tenancy.
The concept of community property is based on Spanish law. Early WashingtonState settlers had little contact with :country-region Spain or the Spanish culture. However, they did pattern many of their early laws on California?s legal system and CaliforniaState has a history that is rich with Spanish influence.
When Community Property Rules Apply
Under community property rules, all property owned by a married couple is classified either as the separate property of one spouse or as the community property of both spouses. These classifications determine a couple?s rights and duties in regard to the property.
Community property rules apply only to property acquired during a marriage. If a couple is not legally married, they cannot acquire community property, no matter how long they have lived together or how much their relationship resembles a marriage.
In some states, a couple that has lived together for a certain number of years in a marriage like relationship is considered legally married, even though there has been no marriage ceremony and no marriage license has been obtained or signed. This kind of marriage is called a common law marriage. WashingtonState law does not provide for common law marriages. However, if a couple has met the common law marriage requirements of another state before moving to WashingtonState, they will be considered legally married when they move to WashingtonState and the property they acquire while living in Washington will be considered community property.
Note that although property acquired by an unmarried couple is not community property, both parties may have a common interest in that property. The property rights of each party depend on the type of relationship that exists between them.
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