Why Buy a Property in Dismemberment
Summary
– The dismemberment of property: definition
– Terms of the purchase in the dismemberment of ownership
You want to buy a property, then transfer it to your ascendants or descendants shortly. Have you thought about the purchase in the dismemberment of ownership?
The dismemberment of property: definition
An article of the law states that ownership is the right to enjoy and dispose of things in an absolute manner, provided that one does not make a use prohibited by laws or regulations.
The right of ownership, in a classical way, is broken down into several elements:
– usus, which corresponds to the right to use the property;
– abusus, which is the right to dispose of the property (transfer it, alienate it, transmit it…);
– the fructus allows one to reap the fruits of the property.
The right to ownership can be dismembered, which means that several persons can divide these attributes.
The abusus alone is equivalent to the “bare ownership” of a property. It is a fact of disposing of it without using it directly oneself.
The usus and the fructus, which allow enjoying the property, correspond to the usufruct. These rights are precarious and end with the disappearance of the beneficiary (or the end of a period if this has been provided for).
Indeed, an article of the civil code states that usufruct is the right to enjoy things owned by another, like the owner himself, but with the obligation to preserve the substance of the property.
Good to know: an adage states that the usufruct joins the bare ownership by extinction. All the attributes are then combined to constitute an exclusive property.
So why buy a property in dismemberment? What are the terms and conditions? Let’s see in detail.
Terms of the purchase in the dismemberment of property
Buying a property in the dismemberment of ownership benefits from considerable tax advantages. Upon the death of the usufructuary, the bare owner becomes the full owner of the property.
There are several types of purchases in the dismemberment of ownership.
The purchase in dismemberment is known as “simple”.
This is the most classic operation. Parents buy the usufruct of a property, and their child acquires the bare ownership. The parents enjoy the property during their lifetime. Once the parents die, the child becomes the property owner by right, without paying inheritance tax.
Good to know: the shares relating to the usufruct and bare ownership of the property are calculated differently at purchase.
The purchase in crossed dismemberment
In this situation, things are different. Each party buys a share of usufruct and a share of bare ownership of the property.
Unmarried or civil union couples prefer this transaction
When the spouse dies, the survivor remains in possession of both his or her share of bare ownership and usufruct. They, therefore, retain the right to use the property.
The purchase in dismemberment can also intervene via a real estate company, making it possible to operate transfers of shares with attached rights (bare ownership/usufruct) between the partners.
Read more:
- 6 Important Questions to Ask Yourself When Buying an Apartment;
- Should You Renovate Before Selling Your Home;
- Getting a Quote for a Renovation Project;
- Real Estate: Buying or Building?
- 5 Steps to Negotiate a Mortgage;
- How to Conduct Real Estate Research;
- Best Materials for Building Your House;
- 3 Tips Before You Buy an Old House;
- What to Verify Before Buying Your Property;
- Buying a House as a Couple: 2 Things You Should Know;
- Buy-Back of an Equitable Share Between Spouses;
- Real Estate Rental With Option to Buy.
