Properties can be gifted, set into a trust, passed out when we’re alive or after we’re dead, and be transferred temporarily. Huh.
(Would anyone like to gift me a property or more please? 🙂 )
Gift
A property gift is a voluntary transfer of a property, from donor/grantor to donee/grantee, made without consideration of money, through a Deed of Gift created by a lawyer.
Lifetime gifts are made in the donor’s lifetime (inter vivos).
Testamentary gifts are made by will and are effective after donor’s death.
Bankruptcy:
- Deed of Gifts in the last three years: void.
Deed of Gifts in the last (rule changed) to five years: voidable,unless evidence shows donor/grantor’s solvency at date of gift.
Trust
A fiduciary relationship (in good faith for others!) where a trustor gives a trustee the right to hold the title of property for the benefit of a beneficiary, through a Deed of Trust — laying out conditions of trustor-trustee relationship.
Express intentions / inter vivos trust is made in the trustor’s lifetime.
Will / Testamentary trust is effective after trustor’s death.
The law may also create trusts when it is implied:
- Resulting trust
- I pay but register another’s name
- Constructive trust
- misappropriated someone’s money to buy under me
- Unregistered trust
- sellers hold properties on trust in the period before a sale is completed.
Fiduciary duties include being honest, careful, creating proper accounts,
to act in best interest.
Trusts are removed with an application to court.
Real Estate Investment Trusts (REITS) allow investors to pool money for big investments, buying REIT shares or transferring the title to a trustee who manages the property for them (as beneficiaries).
Owners receive certificates of ownership that can be sold, with income distributed to certificate owners.
Succession
Passing our properties to our successors can go one of a few ways.
Will — in writing, signed by testator and two non-beneficiary witnesses. Includes administration and distribution of estate by executor, and any trustee if needed.
Testate succession when a will is made.
Court issues a Grant of Probate to make the will public. Executors apply and then distribute.
Intestate succession when no will is made.
- Administrators apply for Letters of Administration, and follow the government rules.
- Spouse – children – parents – siblings – grandparents – uncles/aunts – government.
Syariah law (Islamic laws) indicate that muslims can give away a maximum of 1/3 of their estate to those not entitled in the law’s Faraid (Islamic inheritance laws).
With a will, an Inheritance Certificate will be issued according to will, and the balance Faraid.
Without a will, Inheritance Certificate issued according to Faraid.
- Tenants-in-common (each owner holds a share)
- Will or Faraid
- Joint tenants (shared ownership)
- right of survivorship (fatwa issued for this)
- or Faraid if chosen.
Estate duty was a death tax on property market value. Gone 2008.
Future interest
Future interest — a legal right to property without present possession or enjoyment.
Reversionary interest — future interest kept during a transfer.
Remainder interest — if a property is willed away or sold, then the future interest is not reversionary, it is remainder.
Life estate — ownership of land for the duration of a person’s life. The property can be sold, but when the life tenant dies, the life interest ends, and the future/remainder interest engages, with a reversion to the original owner.
Present interest — legal or equitable in the form of freehold, leasehold, or life estate. (legal — name in ownership certificate or tenancy agreement, equitable — name in will, trust…)
Related terms:
- alienate — to transfer/convey title, property, rights
- government to alienate land to developer
- convey — to transfer/pass the title
- buyer convey to seller
- assign — transfer apart from title
- owner assigns to tenant.
If no one claims the land within three years, the land reverts to the State. Even if occupied.
❤️🌧️
Image of flowers and gifts by Soledadsnp from Pixabay.
