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A New Form of Title Available to Husbands
And Wives Owning Real Property in California
After July 1, 2001
husbands and wives owning real property in California can opt to take title in
the form of Community Property with Right of Survivorship.
What Does This Mean?
Community
Property with Right of Survivorship has the same attributes as the traditional
community property form of title but, like joint tenancy, has the additional
attribute of the right of survivorship. When a husband and wife hold title as
Community Property with Right of Survivorship, the full interest in the
property will vest, by law, in the surviving spouse immediately upon the death
of the first spouse. Title insurers will be able to vest title free and clear
of the deceased spouse's interest merely by the recordation of an affidavit
similar to the one used to clear the interest of a deceased joint tenant. The
survivorship feature will, in most instances, avoid the lengthy escrow delays
caused by probate proceedings and other legal actions often associated with the
traditional community property form of title. Spouses will also have the
ability to unilaterally sever the right of survivorship in the same manner that
a joint tenancy is severed. Severance of the right of survivorship may result
in the property being vested in the traditional community property form.
As with any form of title, there are tax and
other legal consequences that must be considered by husbands and wives choosing
to take new title in the new form. The decision to take title in the form of
Community Property with Right of Survivorship should not be made until parties
have consulted with their attorney and tax advisor.
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