The Basics of Home Ownership

One of the most important decisions a person makes in their financial life is the purchase of a home. The purchase of a home is usually the largest investment a couple makes together. Determining how best to title property when you intend to own the property in both, your and your spouse’s name is something most couples struggle with. This decision is made even more complicated for American Muslims due to Islamic rules of inheritance and property ownership. We’ll guide you through some important issues you should consider when you are ready to purchase a home, an investment property, or even if you already own a home but would like to change how you and your spouse own the home.

Your state laws govern ownership of real property, how property is inherited by your beneficiaries, different types of tax and estate considerations, and much more. These laws can be very complicated and most states still enforce laws that were enacted many years ago. Adding to the complexity are the various Islamic rules that affect how American Muslims should owner property.

There are three primary ways to own a home (or investment property) jointly as a married couple: (1) Joint Tenancy with Rights of Survivorship; (2) Joint Tenancy without Rights of Survivorship; and (3) Joint Ownership. Although there are countless considerations for how best to own property ranging from taxes, inheritance, liability protections, and transferability, this article mainly addresses the Islamic considerations of a married couple owning property by joint tenancy with rights of survivorship. For simplicity, we’ll refer to Joint Tenancy with Rights of Survivorship as “JTRS”.

Joint Tenancy by the Entirety is a relatively new invention of American jurisprudence, yet all 50 states recognize some form of joint tenancy by the entirety. Properties owned by JTRS transfer to the surviving spouse when one spouse passes away. This transfer occurs by operation of law, which means no document or filing is needed to effectuate the change in ownership.

It is often difficult to think about one’s own death and consider how assets are to be distributed to the loved ones left behind. It can also be daunting to consider all of the tax implications of estate planning, contingency scenarios, state and federal laws governing probate, Islamic rules of inheritance, and financial planning for children, your spouse, and other family members. While there are several online solutions designed to make creating your Will easier, none provide a real solution to American Muslims. MyWassiyah is the solution.

MyWassiyah is a revolutionary product designed to be beautiful, easy and affordable to use. You can now create your estate planning documents in minutes. Our proprietary service walks you through our online interview with simple questions and comprehensive, easy to understand explanations. After completing the online interview, MyWassiyah creates your documents which are immediately available for you to print and sign. The entire process is easy to finish and costs as low as $100. Each document created by MyWassiyah is customized for your state’s laws and is fully personal to you and your family’s needs. Dr. Joseph Lombardo, Professor of Islamic studies at the American University of Sharjah and editor of Study Quran said that, “MyWassiyah.com makes it possible for every Muslim to fulfill this fundamental obligation towards God and their loved ones from the comfort of their own home at a very affordable price.”

So what happens if a person dies without a validly executed Will in the United States? A person who dies without a valid Will is said to have passed away intestate (‘intestate’ simply meaning dying without a Will). If you die intestate, probate courts will use your state’s probate laws to determine how and to whom your estate is distributed. None of your surviving family members will have authority to change how your assets are distributed after you die. This is particularly important for American Muslims since there is not a single state that embraces Islamic principles when determining how to distribute the estate of someone who passes away without a Will. It is therefore guaranteed that you will not comply with your Islamic obligations if you die intestate.

A Will not only ensures that you fulfill with your Islamic obligations mandated by Allah, but it also gives you the ability to care for your family in situations that are both, unexpected and unfortunate. One of the most important decisions you need to make when preparing your Will is the appointment of the guardian(s) for your minor children and the personal representatives tasked with administering your estate.

When you consider how to care for your children after your death, you need to think about your children’s financial and general well-being. One of the most important considerations you will make in your MyWassiyah Islamic Will is who will care for your children after your death. The person you appoint to have the legal responsibility for your child’s care after your death is called the guardian. The appointment of a legal guardian for your children is governed by state laws and is ultimately reviewed by the court, which will follow your request if feasible.

When preparing your estate plan, an important consideration is what happens when unexpected life events happen leaving you unable to make decisions for yourself. Protecting against these unfortunate events requires lifetime planning. A power of attorney designation is a legal document in which you grant an adult the power to act on your behalf for a broad range of matters. This can include the power to act on your behalf for business, tax, financial, personal and family matters.

Although a basic power of attorney designation expires upon death or mental incapacity, a durable power of attorney survives mental incapacity. Many very difficult situations that arise due to a person’s mental incapacity can be resolved simply if a durable power of attorney was prepared. It is critical that the durable power of attorney be prepared early since it obviously cannot be prepared once a person lacks the mental capacity to make decisions on his or her behalf.