What is personal property?
It is property which is movable. An easy way to remember this is, personal property is also referred to as chattel. What sounds like chattel? Cattle! What sound do cattle make? Moo! Personal property (chattel) is movable.
Another way to quickly remember what is real property and personal is if you took a house off its foundation and turned it upside down and shook it, whatever fell out would be considered personal. Whatever didn’t fall out would be regarded as real property.
Personal property is also referred to as personalty.
Why does this matter?
Good question. When you buy a home, all the real property conveys in the sale. So, it is essential to understand what is considered personal, since the personal property will be taken by the seller when they move. When looking at a house, do you like the furniture inside? You better find out where the seller bought it, cause they are taking it with them when they move.
Are there different types of personal property?
Yes, personal property can either be tangible, which is something that can be seen and touched. Such as a dining room table. Alternatively, it can be intangible, such as an insurance policy, which is represented by a contract.
Can personal become real property?
Yup, it sure can. If it is permanently attached to the structure or ground, then it would be considered to be real property and would convey in the sale. A chandelier is a great example. When the chandelier is first purchased and is sitting in the garage awaiting install, it would be considered personal. Once it is installed in the ceiling, it becomes real property and would convey to the seller.
Once real property is attached it is known as a fixture. A fixture is real property.
What’s it called when personal becomes real property?
It’s called attachment. Conversely, real property can become personal in the reverse scenario by severance. Removing a built-in cabinet is an excellent example of severance.
How can it be transferred?
Ownership of personal property can be transferred by a bill of sale, whereas ownership of real property is transferred by deed.
What else can help me prepare to pass my real estate licensing exam on my first attempt?
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