How would you hold title?

Question

My mother my brother and myself are buying a duplex and are trying to decide if we should put it in an llc or just keep it in our own names. I currently own a few rentals that are in my own name. The issue is being able to pull money back out of the property to get another rental. We are paying cash for the property. Our credit union told us if we put it in an llc they won't work with us. We plan to hold the property long term. If we do keep it in our names should it be survivorship?

Thanks

Bill Gulley · Answer

Joint tenancy with rights of survivorship. Just get insurance to protect you and don't be negligent through good management and you'll be just fine. You don't need an LLC every time you turn around. Each of you should have a Will addressing interests to be conveyed. Good luck :)

David Krulac · Answer

Bill Gulley would be to consult with their own Pennsylvania attorney.

David Krulac · Answer

Bill Gulley You're still wrong.The law book says,"A joint tenancy interest cannot be given away by will because at the moment of death, title vest in the remaining joint tenants. If A, B, and C are joint tenants and C dies, A and B remain joint tenants and hold title to the property. C's heirs have no rights or interest in the property. If B then dies, A will hold full title to the property and B's heirs have no rights or interest in the property."I rest my case, counselor.

David Krulac · Answer

Bill Gulley That's not correct, Sir. The JTWROS would supersede the will and make the will wishes invalid (only to this property.)The only way to make the will valid is Tenants in Common.I know first mistake in 18,000 posts!

David Krulac · Answer

Bill Gulley Congrats on 18,000 posts! WOW!I'm not sure JTWROS is always the best move. If any of the partners, even though family, have spouses or children; those "heirs" would be disinherited by the JTWROS. That may not work for all situations, whereas Tenants in Common, allow the partners to chose heirs other than their existing partners.

Bill Gulley · Answer

That changes things, now I suggest you look into an trust deed, to an inter vivos or living trust. This will not complicate your financing as an LLC may, but an LLC can also direct distributions through the Operating Agreement, so see an attorney as I suggested. :)

Fran Harvey · Answer

ok thanks. I agree wouldn't want my children to come in at a young age thinking they no what they are doing just because they can and try to make changes. I just want them to get there part of the proceeds while my brother is still alive and then get there half when he passes. He is the younger one:)

Bill Gulley · Answer

In that case, use a TIC as David mentioned. But, also, speak to the others about an 18 year old with no RE knowledge being in title and what motivations they may have. You'll need to set up a trustee arrangement for minors as well. I suggest you speak to your family attorney if your estate is not sizable, if it is, an estate attorney might be better (and more expensive) to ensure your wishes are carried out. Personal choice, I use JT in my family and we have other agreements/arrangements to govern. :)

Fran Harvey · Answer

I would like my brother or myself to run the properties until the other passes and then for it to be split between our heirs. If that helps.

Bill Gulley · Answer

That looks like a description of deeds out of a real estate book, not state statue but that is correct. 1. they are family, 2. there are differences in English law and Community Property laws, that can govern, 3. estate planning can address disbursements of assets to balance equities among the heirs, 4. operating agreements can kick in after automatic deed transfers to accomplish further transfers. Any transfer of any kind can be contested and other heirs may prevail in some manner of equity.If the OP were to give more details, how they would address estate matters, we can't really say which is best. My first assumption remains the same.When I make mistakes and I do being human, I admit them, this is not necessarily one of them, I understand your point (and perhaps your motivation) but without more information by the OP, I'll stick to my suggestion. I'm not a lawyer, I think you know that so "counselor" seems a bit sarcastic. Are you a CFP, or an estate attorney, I don't think so. So, I'm not arguing with you David. Looks like you're more concerned in trying to "catch me" in an error than understanding what approaches are available for estate planning. As to the operation of the shared interests of the RE, I'd rather see title going to those familiar with the property management instead of a 19 year old, the 19 year old can be taken care of by income from that property by other agreements if that is a concern. :)