The form of ownership chosen in your purchase, known as the vesting (holding title), will determine who may sign various documents and future rights of the individuals in the transaction; it can have an effect on one person buying as well as multiple people. You may have already heard some of the terms, joint tenancy, community property, tenants in common, sole ownership, or held in trust.
These rights associated with each type of vesting involve such matters as: real property taxes, income taxes, inheritance and gift taxes, transferability of title, exposure to creditor’s claims and significant probate implications in the event of death.
Before you can close escrow (or get loan documents), you must have selected a method of ownership. Please get started on that process as soon as you begin the search for property. Living trusts for instance, can take months to set up, so your preparation is important.
I urge you to speak with your attorney and/or tax advisor as soon as possible for vesting questions. Your advisor may make recommendations which require partnership agreements, trust documents, wills, or other such documents. Since these decisions and the accompanying documents may take time to be generated, I urge you to start this process immediately so that they may be accomplished prior to close of escrow.