Page 26 - Southern Exposure - December '23
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Page 26, Southern Exposure



                                                          eLder estate pLanninG




                                    Beware Of Unequal Contributions



                                              When Purchasing A House



                                                             Submitted by Anné Desormier-Cartwright, Esq.

        At a time of record home                          For most people, a home is their greatest investment and     For those who already own a house, how the property
      unaffordability, more people                      the primary driver of household wealth. Even if somebody   is titled is no less important to their estate plan.
      are teaming up with friends                       co-owns a house, their investment in the property is likely   Circumstances change. The original title terms may no
      and relatives to realize the                      to dwarf their other accounts and property.        longer reflect a person’s current priorities. While changing
      home ownership dream.                               Deciding what to do with shares of a jointly-owned property   a joint tenancy may not always be possible or practical,
      According to the National                         is a major estate planning consideration. And it begins at the   at the very least, a person should know how a home title
      Association of Realtors                           time a property is purchased and the title is issued.   affects their property rights, the rights of any heirs, and
      (NAR), more than 75 percent                         When co-buying a house, each owner should understand   tax obligations.
      of homes on the market                            how it is being titled and make sure the titling matches their   Get Your Estate Planning House In Order
      now are too expensive for                         estate planning wishes. For example, joint tenancy might     Choosing how to title a co-owned home, and how this
      middle-income buyers. Just                        make sense for a married couple but be a poor choice for   choice fits into your estate plan, depends on the people and
      five years ago, this same                         friends or unmarried partners because they give up the right   property involved, your estate planning goals, and state
      income group could afford half of all available homes.  From   to leave the property to anyone other than the co-owner.   laws where the property is located. An estate planning
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      2010 to 2020, the number of homes bought by people with     In the latter case, tenancy in common is likely a better   attorney from our office can explain the pros, cons, and
      different last names soared by more than 770 percent. This   option. Each tenant in common has the power to dispose   consequences of each type of joint ownership to help you
      group includes friends, roommates, and married couples.  In   of their property interest however they choose – but only   decide which one best fits your situation.
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      2021, the percentage of single-family homes purchased by   if they indicate their wishes in their estate plan. Otherwise,
      nonmarried co-buyers was 25 percent, up from 17.4 percent   their share of the property passes according to state law   Elder Estate Planning on page 27
      in 2018.  Purchasing a property with other people can help   when they die.
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      a buyer to lower their individual costs while building equity.
      However, going in on a house together can also create trouble                               “Service is our number one priority”
      spots, including survivorship and inheritance issues.
        A home is the largest single investment that most people                                                561-743-0070
      make. When buying a home with another person, the co-
      owners must decide how to hold the title so that it aligns with                                        www.palmspoolservices.com
      their wealth-building and estate planning goals.
      Co-Ownership And Home Titles
        Co-buying a home with a partner, relative, or friend can
      reduce the costs of the down payment, mortgage payments,
      utilities, and other household expenses for each buyer, while
      allowing them to build home equity. Some co-buyers may
      not even want to live in the home. Their goal may be to rent
      it out or flip it for a profit.
        Home co-ownership can present problems as well. If one
      buyer has a bad credit score, it can negatively affect another
      buyer’s mortgage terms. And if one party cannot meet their
      financial obligations, the other party could be on the hook
      for the budget shortfall.
        Typically, co-owners are not only listed together on the                                                                    Expires 1/15/24.
      mortgage loan, but on the home title. Having more than one
      person on the title raises estate planning issues that may not
      immediately arise but should be thought about.                                                                     State Licensed & Insured
        Property can be titled in different ways. Common ways   Serving Palm Beach County                              CPC # 1457468 • LPG#30099
      of joint ownership titling include tenants in common, joint
      tenants with right of survivorship, and tenants by the entirety.
        • Tenants in common. With this type of title, property
      shares may or may not be divided equally between owners.
      Each owner’s share might be equal to their investment in
      the property or the shares may be divided equally among the
      owners. However, the co-owners still have equal rights to use
      all areas of the property. They can also choose who receives
      their interest when they die; it does not automatically pass
      to the other owner(s).
        • Joint tenants with right of survivorship. Under this        Upscale Resale
      arrangement, each owner has an undivided interest in the
      property. They own the property in equal shares and have   Experience The Difference
      the right to use the property however they wish. The right of
      survivorship means that, when one of the joint owners dies,   New and consigned furniture, unique lighting, accessories and gifts.
      their property interest passes to the surviving joint owner(s).   Complete wallpaper and fabric library for all your design needs.
        • Tenancy by the entirety. This title option works the same
      way as joint tenants with right of survivorship but is only
      available to married couples in certain states. It also provides
      valuable creditor protection because property owned in this
      way is not subject to the creditors of just one spouse (although
      it may be subject to the claims of a creditor of both spouses).
        In states with community property, another type of joint
      ownership for married couples, co-owned property can be
      titled with the right of survivorship, but it is not the default
      and must be designated this way.
      Joint Ownership And Estate Planning
        Around 60 percent of Americans do not have a will,                        Call us to sell. See us to buy.
      but the percentage without an estate plan is highest among   Over 32,000 sq. ft. in 2 locations to serve you!
      Millennials (78 percent) and lower among Baby Boomers (58
      percent). About two-thirds of Gen Xers do not have a will,   PALM BEACH GARDENS:           New Location
      while more than 80 percent of those age 72 or older do have   7700 N Military Trail • 561.694.0964
      a will. 4
        One of the top reasons cited for failing to address estate   WELLINGTON: Wellington Marketplace
      planning is a lack of assets to leave to anyone. While this is   13857 Wellington Trace • 561.798.5222
      often a myth – estate planning is advisable no matter how
      many assets a person has – buying a house instantly changes    myconsignanddesign.com                                     Nanci Smith, CEO
      this calculus.
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