1. Tenants in Common

Taking title to real estate as tenants in common is sometimes a deliberate choice or can be the default when no other method is specified. In a tenancy in common, two or more people can share ownership rights to real property with each owner having a right to use and possess the entire parcel, regardless of the fractional share each owner paid. So, for example, if A pays $40K and B pays $60K for the property, this does not mean that B gets to divide the property up consistent with his 60% share and exclude A from it. Rather, both A and B must share the entire property.
The 50/50 rule applies to most aspects of a tenancy in common. For example, owners are equally responsible for maintenance costs and taxes. Only one property tax bill will be issued for the parcel, thus it is the responsibility of the parties to divide costs up as they see fit. The most efficient way to do this is through a tenancy in common agreement. Further, each owner is said to own his or her interest “severally”, meaning that he or she is free to sell or dispose of his or her interest, and no consent of the other co-owner is necessary to do so. It is easy to see some of the pros and cons of a tenancy in common, compiled below:

Pros of a tenancy in common:

• Allows individuals to pool their resources so that they can afford property,

• Each party can own different sections of the property if specified by a tenancy in common agreement, and

• Property taxes and other expenses are split between all owners

Cons of a tenancy in common:

• There are no survivorship rights in a tenancy in common, which means that when one owner dies, his/her share does not pass to the other owner, but rather to the decedent’s estate,

• Each owner must share the entire parcel with the other owner, unless the parties agree otherwise, and

• Owners may end up with unanticipated co-owners as a result of each owner’s right to freely transfer or sell their interest or when one owner passes away.

2. Joint tenancy

A joint tenancy, like a tenancy in common, allows two or more people or entities to share a property equally. However, unlike a tenancy in common, joint tenants have survivorship rights, meaning that if one owner dies, his or her share passes to the remaining owner or owners.
Joint tenants, like tenants in common, must share the entire parcel with the other owners. There is still the option of drafting a joint tenancy agreement to fractionally divide each owner’s share. However, there are some unexpected nuances here. For example, if joint tenants agreed to fractionally divide the parcel and one joint tenant decides to lease his or her share, most would presume that the owner offering the lease gets to keep all proceeds from the lease. However, this is incorrect – the typical presumption is that the lease proceeds must be split 50/50 or equally with the other owners.

Pros of a joint tenancy:

• Survivorship rights when one owner dies; his or her interest passes to the remaining owner(s), thus affording the opportunity to become a sole owner,

• Each owner can own specified sections of the property if specified by a joint tenancy agreement, and

• Property taxes and other expenses are split between all owners

Cons of a joint tenancy:

• Each owner must share the parcel with the other owners, unless the parties agree otherwise, and

• Equal rights and responsibilities of all owners mean that if one owner takes a loan out against the property, all co-owners may responsible.

3. Marital property

Wisconsin, being a marital property state views all property as owned by the marriage, not each individual in it. Thus, each spouse automatically owns a ½ share of all property acquired in the marriage, unless a marital property agreement specifies otherwise. For Wisconsin transplants who have acquired property out-of-state before moving to Wisconsin, property is recognized as quasi-community property, which is complex and helps courts determine how to divide property upon divorce or death.
Marital property, like property taken in joint tenancy, has survivorship rights. In the marital context, this means that if one spouses dies, the surviving spouse receives the deceased spouse’s half of the property. A common example is a home held in title as marital property. If both spouses are on the deed to the home, then the entire home goes to the surviving spouse. Depending on each couple’s situation, this may be either a pro or a con. Some of these pros and cons are outlined below:

Pros of marital property:

• Survivorship rights: If one spouse dies, his or her share goes to the surviving spouse

Cons of marital property:

• Frustrated interests: If one spouse wants to sell, but the other does not, it can cause a gridlock on being able to sell the property. Both spouses need to agree to sell.

• Even if one spouse was the one to acquire the property at first, the other spouse may acquire a ½ share if the property is used as a primary residence or marital funds are used to pay or upkeep the property. This can be a con in the context of divorce or estate planning.

Summary:

Now that you understand the three ways co-owners can take title to property and the cons that may arise when co-owners interest become frustrated, you may be wondering what solutions are available when co-owners cannot come to an agreement.

One option is asking the court to petition the property, which will be discussed in our upcoming blog post. Stay tuned and read on!

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What Does FSBO (For Sale by Owner) Mean?

FSBO means that you’re selling your home without involving a real estate agent. In this case, you’ll handle all selling processes and transactions. These processes vary from showing the house to drafting paperwork for the negotiations. Moreover, you may be wondering what the selling process is like for sale by owner situations. It is transparent and straightforward when you follow the right path. The main reason for using FSBO is to save money. So why should you consider this aspect? A real estate agent takes a commission based on a percentage of the sales price. Depending on the agreement, a listing agent may take somewhere between 3% to 6% of the sales price as commission. So, if your home is worth millions, you can calculate and see how much the listing agent would take. Using FSBO gives you the power to control the entire sale process; however, you may need to hire a real estate lawyer to help you successfully sell the property. A lawyer ensures that you understand the legal obligations of selling your home. The best thing is that a lawyer won’t cost you a percentage of the sales price, and you’ll have peace of mind knowing that everything is correct. Better yet, a lawyer can help you avoid legal issues that can cost you more money or time in the selling process while still helping you get a fair deal for your property.

What Are the Steps in An FSBO Process?

There are some vital steps that you must follow to make sure you close the deal successfully. It will help if you position yourself professionally to attract customers looking for a property like yours. Here are the steps that you should follow in FSBO processes.

Analyze Pros and Cons of The Entire Process

Selling a house can be the largest financial transaction of your entire life. You don’t want to mess it up with the wrong approach. Look at the coin from both sides and not just how much money you’ll save. Are you prepared to show your house yourself? How will you market your home? Do you feel comfortable talking directly to potential buyers?

Make Some Fundamental Home Improvements to Boost the Value of The House

Getting your house ready is an essential aspect. Make sure you fix the interior and exterior to make your home attractive. The home improvements can help you to attract more potential serious buyers. Also, it would be best to make these repairs and upgrades early enough to post photos of the updates you have made. As a result, you may get additional money for your home.

Set A Favorable Price

Setting the sales price calls for you to do thorough research on various platforms. For example, you need to know the closest sales prices near your home, also known as comparable sales or “comps”. In addition, to avoid over or underpricing, you will need to know where your home falls in the market and consider the age, condition, and location of your home compared with recent sales.

Hire a Real Estate Lawyer

This is one of the essential aspects of FSBO. Hire Attorney Shannon Wynn of Wynn at Law, LLC, who will draft residential sale agreements and walk you through the sales process. In addition, she will help you avoid omissions and errors that can have legal liabilities during or after the sale. Attorney Shannon Wynn at Lake Geneva, Wisconsin-based firm Wynn at Law, LLC will ensure that the FSBO is transparent for you and that your deal is done correctly.

Carry Out a Thorough Marketing Campaign for Your Home

Place your home on real estate sales websites and notify your neighbors and friends of the house being for sale. Make sure the content you place online is accurate and enticing. In addition, make sure you put out yard signs so those who travel past know that the house is for sale.

Show Your Home to Interested Parties

Try your best to show your house to as many interested people as possible. For example, if you have COVID-19 concerns or have children and pets, you can give potential buyers a live video tour of your home. You can also host open houses so more people can visit the home at one time.

Review Paperwork with Your Lawyer and Initiate Negotiation

Review the purchase contract with a trusted and professional real estate lawyer like Attorney Shannon Wynn and negotiate accordingly.

Close your Sale

Do you need a lawyer to close on a house sale? Yes, you should have one. An attorney will help you order title work, draft the deed, and will review the closing documents, such as the closing statement, with you. Having a lawyer in your corner will help to make this transition as smooth as possible. Selling a home is no small feat and Attorney Shannon Wynn understands that.

Why Hiring an FSBO Lawyer Is Beneficial

When you sell your home via FSBO, you save on paying a listing agent or broker. Nonetheless, you’re left to handle complex tasks that involve preparing an offer to purchase or counteroffer, showing your home to potential buyers, ordering title insurance, and closing the transaction. One omission, error, or mistake can lead to legal liabilities, and that’s why it’s recommended that you hire a local and experienced real estate attorney.

Here is why you should hire a real estate lawyer:

Complex Paperwork Handling

You’ll notice that selling a home has a lot of complex paperwork with legal jargon that would take a significant amount of time for an average person to understand. The legal aspects of home sales can complicate the For Sale By Owner process in Wisconsin. Attorney Shannon Wynn can help you untangle every detail in the paperwork and make sure that you comply with the law.

Preparation Of the Contract

You may have prepared an offer to purchase before, but have you done one without the help of a real estate agent? There are fundamental aspects that must be incorporated into the agreement. For that reason, you need to hire a credible attorney that helps you formulate a contract that protects your interests.

The Attorney Takes Your Interest as a Priority

Unlike real estate agents or brokers who rely on commissions when your property is sold, lawyers rely on the time they spend on your home sale to get paid. As a result, attorney fees are often far less expensive than real estate commissions. An attorney’s sole job is to protect your interests.

A Lawyer Helps You Manage All Parties Involved

An attorney can help you communicate with the various parties involved during the sale process. These parties may include the buyers, inspection companies, lenders, contractors, and appraisers.

Let Wynn at Law, LLC Help You Sell Your Home

Selling your home via for sale by owner in Wisconsin is one strategy for selling your home. FSBO helps you eliminate the listing agent and potentially save you thousands of dollars in commission. While FSBO may be the best option for maximizing profit on your sale, the entire process is complex. You need to know the process inside-and-out or hire an attorney to represent you. A lawyer protects your interests and helps you avoid legal liabilities. At Wynn At Law, LLC, we can help you with your FSBO in Wisconsin. For inquiries, contact us today at (262) 725-0175 or visit www.wynnatlaw.com. Wynn at Law, LLC has offices in Delavan, Lake Geneva, and Salem Lakes and serves all of Southeastern Wisconsin.

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