There are many potential problems for the joint purchase you describe, especially if one of the couples divorces or files bankruptcy. As the mortgage lender, you are very wise to think of these possible problems before the purchase.

Holding title in a partnership can provide for the issues you mention, such as dividing expenses and providing for a buy-out if one couple wants to sell but the other doesn't. Each couple can hold their half of the property in their separate living trust to avoid probate if a spouse dies or becomes incapacitated.

HOW SHOULD COLLEGE BUDDIES INVEST IN REAL ESTATE?

DEAR BOB: A couple of college buddies and I are just beginning our lives as professional businesspersons and we want to partner up in some real estate investing. None of us intends to make real estate investing a full-time job. We just want to take on a project or two when opportunity exists. What is the best way to go about this? We all trust each other 100 percent. Should we form a corporation, a general partnership or LLC (limited liability company)? --Rav D.

DEAR RAV: Congratulations on starting your real estate investing early. I started way too late at age 27. There is no better long-term investment than sound, well-located real estate, as you will soon discover.

You probably thought your question was simple. But it is quite complex.

Because your personal resources, goals and situations might vary, especially after a partner marries and the spouse acquires possible marital interest in the investment property, a partnership agreement or LLC is often the best way to hold title.

A partnership agreement can provide for many possibilities, especially a buy-out agreement if one partner wants to sell but the others don't.

Before you acquire a property, I suggest you and your pals buy an hour of time from an experienced local real estate attorney. Write down your questions in advance so you don't waste your time or money.

WILL FAMILTY TRUST SURVIVOR RECEIVE A STEPPED-UP BASIS?

DEAR BOB: Our family trust owns our home. When either my wife or I die, will the survivor benefit from a stepped-up market value basis for our home? --Morton S.

DEAR MORTON: If title to your home is held in the name of your revocable living trust, the answer is "yes," the surviving co-owner trustor will receive a stepped-up basis. The living trust is just a title holding method that has nothing to do with the tax consequences.

The primary living trust purposes are (a) avoid probate costs and delays, and (b) provide asset management if a trustor becomes incapacitated, such as by Alzheimer's disease or a severe stroke.

However, if you hold title to your home or other real estate in another type of trust, such as an irrevocable trust, then you should check with your tax adviser to see if the survivor will be entitled to the huge stepped-up basis benefits.

The new Robert Bruss special report, "How to Earn Your First Profit When Buying Your Home or Investment Property Right," is now available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet PDF delivery at www.bobbbruss.com. Questions for this column are welcome at either address.