Making the decision to buy a home is a long process, made up of many steps, that nobody wants to mess up. As home and property ownership is a significant financial investment, every buyer and owner wants to ensure that their property is well-protected from unforeseeable events. This could come with a variety of expectations about who has legal ownership of the home, who is second in line, and what happens if the worst happens. If you’re asking yourself questions like “What is a vesting deed?” or wondering what the title and vesting of a home are, this is the article for you.

The way to make sure that all of your expectations are met is by vesting the property correctly. The title of a home and vesting of a home are two different beasts: the title of a home refers to the actual ownership of a property, while the real estate definition of vesting refers to how owners hold the title of that property. In this blog, we’ll be going a deep-dive into different kinds of vesting. 

Vesting a property determines who has ownership rights and how those rights are distributed in different real-life situations. Understanding the different types of home vesting is crucial so that homeowners are able to get what they want out of unexpected circumstances in the future. Vesting homes allows buyers to control the property and protect it.

What is Home Vesting?

Although it may seem boring because of all of the paperwork involved, home vesting is the legal process of assigning ownership rights to a property. In the end, however, we all know that home ownership is anything but boring!

Vesting a property or home involves preparing and recording legal documents that specify who owns the property and how ownership rights are distributed in a variety of circumstances. The documents necessary for home vesting include home deeds, trusts, and personal wills. Different types of vesting determine what happens to the property in different situations, such as death, divorce, or bankruptcy. Nobody wants any of these common life occurrences to happen to them personally, but as per usual with life, it’s better to be safe than sorry. Out of all of our home owning tips, this is one of the biggest: Spend the necessary time correctly vesting your property!

What type of vesting is right for me?

Figure out what vesting fits your situation best. There’s a kind of vesting for everyone depending on who owns the home or property - from the independent saver to the elder of a big family. No matter who you are, we encourage you to vest your property. Lending Tree goes into more detail about why vesting homes and properties is a big deal here. Below, we break down all your options for home and property vesting, to give you a better idea of which is perfect for you. 

Sole Ownership Home Vesting

Sole ownership is the simplest form of home vesting because there’s only one person involved! This kind of home vesting ensures that only one person has ownership rights to the property. When the sole owner passes away, the property passes on to the person they named in their will or to their next of kin.

Sole ownership vesting is for the independent at heart - individuals who choose this type of vesting likely lead an independent lifestyle, maybe they’re nonconformists, or have chosen a journey that’s off the beaten path of co-ownership and co-living properties. Or maybe they just don’t like to share!

Tenants by Entirety

Tenants by entirety is a type of vesting used by most married couples. This vesting means that both spouses own the entire property, jointly. Perfect for individuals in a committed relationship, this vesting makes sure that each individual in the couple has an equal say in what happens on and to the property, legally. If one spouse passes away, the other spouse automatically inherits the property.

Tenancy in Common

This vesting is used by multiple owners who each have the capacity to own different percentages of the property, also known as fractional interests. Each owner is able to sell, lease, or will their individual share of the property as they see fit. This makes it perfect for diverse groups of people with interests in the same property, as more capable owners are able to own more of the property in total and therefore make bigger payments on their share of the interest. Crucially, if one owner passes away, their ownership rights and percentage of the property pass to their heirs, not the other owners.

Joint Tenancy with Rights of Survivorship

Joint tenancy with rights of survivorship is used by multiple owners who each own equal shares of the property. As the name states, if one owner dies, their share of the property automatically passes to the other owners. This makes it a promising option for big families who want to keep their properties within the family through generations.

So don’t let the paperwork get you down - vesting a property correctly protects your investment and assures that your wishes are followed in different situations. If you’re considering vesting your new or old property, remember that it is always a good idea to consult with an attorney or real estate professional to verify the best type of vesting for your situation. Find out more about the right vesting type for you here.

Feeling overwhelmed? Our agents are here to help. Please contact us for expert advice on vesting your home or property. If you’re in the market for a new home or property, don’t hesitate to take a look at some of our favorite properties.