Chapter 4 Massachusetts. Forms of Real Estate

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1 Chapter 4 Massachusetts Forms of Real Estate

2 Estate in Common In Massachusetts, it is presumed that when a deed conveys land to two or more people or to a husband and a wife except if it is a mortgage, a device, or a conveyance in trust it is conveying ownership as an estate in common, unless there is evidence that another form of ownership was intended. Tenants in common do not have a right of survivorship between owners and may sell or give away their ownership interest. Another distinction of tenants in common is that the ownership interest does not need to be equal. Upon the death of a tenant in common, the estate is probated in order to transfer ownership interest.

3 Joint Tenancy Four main elements indicate a joint tenancy ownership: The joint tenants own an undivided interest in the property as a whole, and each share is equal. All joint tenants own for exactly the same period of time in this case, the tenants lifetime. The joint tenants received and maintain their ownership under the same title. All joint tenants enjoy the same rights until one of them dies. Under the right of survivorship, the death of one joint tenant automatically transfers the remainder of the property in equal parts to the survivors. When only one joint tenant is left alive, he receives the entire estate

4 Tenancy by the Entirety A tenancy by the entirety is created when the conveying deed expressly transfers the property to X and Y as tenants by the entirety ; and the conveyance is to a married couple.

5 Partnership Ownership Partnership ownership results if partnership funds are used in the purchase of property by persons who are partners. Massachusetts has adopted the Uniform Partnership Act, under the terms of which a partner may purchase property with the partnership funds in his own individual name. The property does not have to be in the partnership s name.

6 Cooperatives, Condominiums and Time-Shares To foster the development of safe, decent, and affordable housing, the state encourages the establishment of multiple-family housing cooperative associations. Following statutory requirements, a special kind of corporation is established in which individual unit residents own stock in the corporation and receive a pro-prietary lease entitling her to occupy a specific unit in the building and to use the common areas.

7 Condominiums M.G.L. c. 183A Condominium ownership is a real-property interest combining mixed forms of ownership (e.g., joint tenancy with an estate in common). Condominium means to exercise dominion with others.

8 Condominium Conversion The notice must contain the following three items: The owner has filed or intends to file a master deed converting the property to a condominium. The tenant shall be given a period of time to vacate based on status as elderly, low to moderate income, handicapped, or other. The tenant shall be given a chance to purchase the unit he occupied at terms equal to or better than those offered to the general public.

9 Condominium Closing Requirements In addition to normal property closing requirements, a condominium requires two items: 6D Certificate. Master Insurance Policy.

10 Condominium Financing Condominium buyers are often surprised to find their bank will allow them to buy a house that costs more than a condominium. In calculating how much a buyer can afford, most lenders will include the condominium fee as a monthly expense. Therefore, when calculating how much of a buyer s monthly income is available to carry a mortgage, include the condominium fee.

11 Condominium Super Lien The Massachusetts Con-dominium Super Lien improves a condominium association s right to collect unpaid condominium fees in the case of foreclosure. It allows the condominium association to collect up to six months of overdue condominium fees after taxes and municipal debts have been paid but before any mortgage obligations are paid. This is true even if the condominium association lien is recorded after the mortgage at the Registry of Deeds.

12 Time-Share Ownership M.G.L. c. 183B In a time-share arrangement, a parcel is held by several owners in common. Each owner has the right to use the property for a certain period of time, which may be either fixed or variable. In Massachusetts, an ownership interest in a unit that includes the right of possession during a potentially infinite number of separate periods is an estate in fee simple, and it includes all the rights of common law fee ownership. An interest in a unit that includes the right of possession during five or more separate time periods over a limited number of years that is greater than five, including extension and renewal options, is a common law estate for years.

13 1. Unless stated to the contrary in a deed, ownership of land by a married couple is assumed to be by a. severalty b. joint tenancy c. tenancy in common d. tenancy by the entirety

14 c (72) Unless a particular form of ownership is specified, a deed conveying ownership to two or more people in Massachusetts is presumed to be held as an estate in common

15 2. A married couple holds their property as tenants by the entirety. When the husband dies, the wife will a. one one-half of the property b. own a person property interest c. onw a legal homestead interest d. be sole owner of the property

16 d (73) Because under tenants by the entirety both husband and wife own the entire property, the surviving spouse will be the sole owner.

17 3. Which of the following forms of ownership represent a personal property interest? a. Tenancy by the entirety b. Partnership c. Tenancy in common d. Cooperative housing

18 d (73) A cooperative owner purchases shares in the corporation that holds title to the building. In return for stock in the corporation, the owner receives a proprietary lease, granting occupancy of a specific unit, his interest is treated as personal property.

19 4. In Massachusetts, a tenancy by the entirety a. may be held only by husband and wife b. continues after a spouse s death c. may be partitioned d. gives the husband control of the property

20 a (73) Tenants by the entirety is limited to two married persons who cannot convey or partition their interest without destroying the tenancy.

21 5. The deed to a married couple s property explicitly states that is is held as tenants by the entirety. In Massachusetts they, a. automatically hold the property as joint tenants b. own the property as tenants in common c. may not hold the property as tenants by the entirety d. hold the property as tenants by the entirety

22 d (73) Because the deed specifically states that the married couple intended their ownership to be as tenants by the entirety, they hold the property as tenants by the entirety.

23 6. Which of the following is NOT recognized in Massachusetts? a. Tenancy in common b. Quarter-share c. Common property d. Tenancy by the entirety

24 c (72) Common property or community property is not recognized in Massachusetts. It is a system of property ownership based on the theory that each spouse has equal interest in the property acquired by the efforts of either spouse during the marriage

25 7. Tenants of a building that is being converted to a condominium will a. be given the chance to purchase the unit they occupy b. have to move c. automatically become owners d. be allowed to stay indefinitely

26 a (74) A tenant residing in a building that is being converted to condominiums shall be given the chance to purchase the unit she occupied at terms equal to or better than those offered to the general public.

27 8. A woman holds ownership in a cooperative building. She owns a. in fee simple b. in severalty c. stock in a corporation d. a partnership share

28 c (73) A cooperative owner purchases shares in the corporation that holds title to the building.

29 9. Taxes on a time-share unit are a. paid individually, by each owner b. paid out of a common pool of funds c. assessed against the board d. paid only upon transfer

30 b (75) Time-share property is considered a single parcel for purposes of assessment and taxation.

31 10. A man bought a condominium. When title is conveyed to the man he will a. own his unit in fee simple b. own stock in the association c. pay his taxes to the board d. not have to pay an assessment

32 a (74) Condominium ownerships combine mixed forms of ownership, such as joint ten- ancy with an estate in common. Both forms of ownership, however, are fee simple estates.

33 11. In a building containing four or more units that has been occupied by tenants during the prior year and is currently being converted to condominiums, how long does a tenant have to sign a purchase-and-sale agreement and accept the offer from the landlord? a. 10 days b. 30 days c. 45 days d. 90 days

34 d (74) In Massachusetts, the procedure for offering a unit for sale to the tenants of a building being converted to condominiums requires the owner to provide a signed purchase and sales agreement to the tenant and give the tenant 90 days to sign the agreement and accept the offer

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Quiz 7: Real Estate Ownership

Quiz 7: Real Estate Ownership 1. Victor and Norman are co-owners in fee simple of a small office building. Norman dies intestate and leaves nothing to be distributed to his heirs. Victor is neither related