Chapter 3_updated

Chapter 3_updated - Chapter 3: Ownership of Real Property...

Info iconThis preview shows pages 1–7. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Chapter 3: Ownership of Real Property Hua Sun Department of Accounting and Finance California State University, San Bernardino Jan 22, 2009 Hua Sun (CSUSB) Ownership of Real Property Jan 22, 2009 1 / 28 Estates in Land An estate in land is the interest of the owner of real property. Freehold estates: high form of ownership; no definite ending date. leasehold estate (estate of tenancy): right of possession and use by tenant from landlord within a specific period of time. Hua Sun (CSUSB) Ownership of Real Property Jan 22, 2009 2 / 28 Freehold Estates A fee simple estate: conveys the maximum bundle of rights, most complete form of ownership. I Fee simple absolute has no restrictions, except within the legal boundary. I Fee simple subject to the power of termination: subject to some limitation(condition). If the limitation (condition) is broken, the former owner will be allowed to retake possession (within five years after breach). F Often used for charitable conveyances to ensure that the donors purpose is followed. F Expires 30 years after recording of the creating documents; may renew for another 30 years. F For conditions, may also called fee simple subject to a condition subsequent Hua Sun (CSUSB) Ownership of Real Property Jan 22, 2009 3 / 28 Example A fee simple subject to condition subsequent can be created by the words To A and his heirs, but if/upon condition that/provided that. . . . The grantor must use clear durational language and carve out the right to reenter. Example: Olivia conveys Blueacre to the Town with the words To Town upon condition that it is used as an orphanage, but if it is not, Olivia retains the right to reenter. Hua Sun (CSUSB) Ownership of Real Property Jan 22, 2009 4 / 28 Freehold Estates Life estates: allows a life tenant, to enjoy the use of the property for the length of the measuring life. The measuring life is either that of the life tenant or a third party. I When measuring life ends, all property rights revert back to the original grantor, his or her heirs,or a designated person. F A reversion is the right of the original owner to retake possession when the life estate ends. F Remainder: grantor conveys reversionary interest to a third person(remainderman) F Reservation: A deeds title to B but keeps a life estate. Upon death of A, possession and use pass to B. I The holder of a life estate must keep up the property and pay taxes, but is entitled to reimbursement from the reversioner or remainderman for payment of mortgage principal (not interest) that benefits the estate. Hua Sun (CSUSB) Ownership of Real Property Jan 22, 2009 5 / 28 Example A life estate can be created by the words To A for life, To A for the life of B, To A for life, then to B, or To A for life, but if. . . , to B....
View Full Document

This note was uploaded on 02/23/2010 for the course FIN 81824 taught by Professor Mcgrath during the Winter '09 term at CSU San Bernardino.

Page1 / 28

Chapter 3_updated - Chapter 3: Ownership of Real Property...

This preview shows document pages 1 - 7. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online