There are a variety of ways that one can hold title to real property. The form of ownership you choose has significant legal consequences — affecting your ability to sell, what happens at your death, and your exposure to creditors.

Sole Ownership: Property owned entirely by one person. Words in the deed such as “Bill, a single man” establish title as sole ownership.

Tenants in Common: A form of co-ownership where property is owned by two or more persons at the same time. The proportionate interests and right to possess the property need not be equal. Upon death, the decedent’s interest passes to his or her heirs named in the will, who then become new tenants in common with the surviving owners.

Joint Tenancy: A form of co-ownership where property is owned by two or more persons in equal shares. Each joint owner has an undivided right to possess the whole property. When one joint tenant dies, his or her interest automatically passes to the surviving joint tenant(s) — bypassing probate. This is called the “right of survivorship.”

Tenancy by the Entirety: A special form of joint tenancy available only to married couples, with each spouse owning one-half. Neither spouse can sell the property without the consent of the other. This form of ownership is not available in all states.

Community Property: A special form of ownership between spouses available only in “community property” states. Illinois is not a community property state.

Ownership Through a Trust: While not technically a form of ownership, you may hold real property through your Living Trust. Upon your passing, your interest passes to the successor trustees and beneficiaries you have designated in the trust — without going through probate.

Condominium (Condo): You legally own a particular unit in a multi-unit structure. You also have a shared right to use common areas such as hallways, elevators, gardens, swimming pools, and clubhouses. You pay monthly fees to a homeowners’ association for maintenance of the common areas.

Cooperative (Co-op): You do not own your specific unit. Instead, you own shares of stock in the corporation that owns the entire building and all of its units. You lease your apartment from the corporation according to a formula based on the unit’s size. As a shareholder, you have a right to elect the Board of Directors who manage the cooperative. Co-ops are less common in Illinois than condominiums but do exist, particularly in the Chicago area.

The distinction matters significantly for financing, estate planning, and transfer of ownership. If you are considering purchasing either type of property, it is important to have an attorney review the purchase agreement and governing documents before you sign.

When you purchase real property, you receive a written document called a deed, which transfers ownership of the property from the seller to you. The deed gives you formal legal title to the property. However, the transfer of interest in real property is not complete until the deed is delivered to you — and ideally, recorded with the county.

The deed should be recorded immediately with the county clerk in the county where the property is located. In DeKalb County, Illinois, deeds are recorded with the DeKalb County Recorder of Deeds. By recording the deed, you give public notice that you now have an ownership interest in that property. Recording also establishes the chronological chain of ownership — the “chain of title” — from a series of buyers and sellers over time.

Before you purchase real property, a title search is conducted to confirm that the seller has legal title and that there are no undisclosed liens, claims, or defects. Title insurance typically performs this function and protects you against defects in prior conveyances. If title defects exist, they may be pointed out and excluded from coverage — which is why reviewing title commitments with an attorney before closing is important.

Illinois does not legally require a buyer or seller to have an attorney at closing, but having one is strongly advisable — and common practice in Northern Illinois. Real estate transactions involve significant financial and legal stakes, and the documents you sign at closing have long-term consequences.

An attorney can review your purchase contract before you sign, advise you on contingencies and inspection rights, identify title issues, explain the closing documents, and represent your interests if disputes arise before or during closing. In Illinois, most residential real estate contracts contain an “attorney review period” — typically five business days after signing — during which either party’s attorney can review and modify the contract. Taking advantage of this period by having an attorney involved early can prevent costly problems down the road.

Our attorneys represent buyers, sellers, and lenders in real estate transactions throughout DeKalb County and Northern Illinois. Contact us before you sign — not after.

Owning real property comes with several significant federal income tax advantages:

Mortgage Interest Deduction: The interest paid on a home mortgage or home equity loan is generally deductible as an itemized deduction on your federal tax return. To qualify, the loan must be secured by your primary home or a vacation home that is not rented to others. This deduction is taken on Schedule A of your federal return.

Property Tax Deduction: Real estate taxes paid to state and local governments are also generally deductible on your federal return. The taxes must be based on the assessed value of the property and charged uniformly against all property under the jurisdiction of the taxing authority.

Capital Gains Exemption: When you sell your primary residence, you may exclude up to $250,000 of capital gains from taxable income ($500,000 for married couples filing jointly). To qualify, you must have owned and lived in the home as your primary residence for at least two of the five years before the sale, and must not have excluded gain from another home sale within the two years prior.

Tax laws change, and individual circumstances vary. Always consult with a tax professional or estate planning attorney to understand how these rules apply to your specific situation.

A quitclaim deed transfers — or “releases” — to the recipient whatever present interest the grantor has in a property, with no warranties or guarantees. Unlike a warranty deed, a quitclaim deed carries no express or implied covenants about the quality of title. This means that if the grantor has no interest in the property, a quitclaim deed conveys nothing.

Quitclaim deeds are commonly used in Illinois for transfers between family members, to add or remove a spouse from title, to transfer property into or out of a trust, or to clear up technical title defects. Because they provide no title guarantees, they are generally not appropriate for arms-length sales between strangers. If you are considering using a quitclaim deed to transfer property, it is important to consult with an attorney first to understand the legal and tax consequences of the transfer.

While sharing title to property with your adult children may help avoid probate after your death, it can have a number of serious adverse consequences that are often overlooked.

Adding a joint tenant to your home deed means you have gifted a portion of that property to those named. When you make gifts exceeding the annual gift tax exclusion — currently $19,000 per recipient in 2025 and 2026 — the IRS requires you to file a gift tax return, and in some cases pay gift taxes. Beyond the tax implications, you are also putting your own financial security at risk. If your new co-owners have creditors, face a lawsuit, or go through a divorce, your home could be at risk. Furthermore, such a transfer may jeopardize certain property tax exemptions you enjoy as a senior, veteran, or homesteader in Illinois.

A far better approach is to place your home in a Revocable Living Trust and name your children as beneficiaries of the trust after you die. This accomplishes the same probate-avoidance goal while giving you total control of your home during your lifetime. You can change the beneficiaries at any time, and you can also provide for circumstances such as a child predeceasing you. Our attorneys can help you determine the right approach for your situation.

The closing — sometimes called a “settlement” — is the final meeting of all parties involved in a real estate transaction. At the closing, the buyer and seller (along with their attorneys, the lender’s representative, and a title company representative) sign the documents that officially transfer ownership of the property to the buyer and fund the purchase.

The title company representative facilitates the transfer of title and is responsible for recording the new deed with the county recorder — in DeKalb County, that is the DeKalb County Recorder of Deeds.

Before arriving at the closing, the buyer should do a final walkthrough of the property to confirm it is in the expected condition — checking that appliances, heating, air conditioning, and plumbing are working and that no new damage has occurred since the inspection. After closing, any problems with the property become the buyer’s responsibility.

The buyer should also bring all necessary paperwork and certified funds to cover the purchase price and closing costs. If required documents — such as mortgage, title, or insurance documents — are not in order, the closing may be delayed. Having an attorney review the closing documents in advance helps ensure everything is in order before closing day.