When two or more individuals own property together, there are a number of ways in which these individuals can hold title. Below, we will briefly review three common ways for multiple individuals to own a single property. But these are not the only ways. Individual circumstances will always dictate which way is best, and you should always consult with a real estate attorney, such as Joseph Battaglia, to go over your situation. The main consideration when choosing a method of ownership is how the owners want title to pass when one owner dies, which is discussed below. Also, one of the vesting methods may provide valuable protection against certain creditors, as well. Read on to find out more.
Joint tenants with right of survivorship
Joint tenants with the right of survivorship all own undivided interests in the property. The interests must be equal, accruing under the same conveyance, and beginning at the same time. Upon the death of one joint tenant, the interest passes to the surviving joint tenants, rather than to the heirs of the deceased.
Example: A, B, and C own property as joint tenants with the right of survivorship. When A dies, A’s interest passes to B and C.
Tenants in common
An estate or interest in land held by two or more persons, each having equal rights of possession and enjoyment, but without any right of survivor ownership between the owners. As compared to joint tenancy with the right of survivorship, tenant in common ownership does not need to be equal, meaning the owners can own varying percentages of the whole.
Example: A and B own property as tenants in common. When A dies, A’s interest passes to A’s heirs at law. If A has a will, the property will pass according to the terms of the will. If A has no will, the property will pass according to Florida’s intestacy law.
Tenants by the entirety
This method of ownership is by married persons, who, together own the entire property. Upon the death of one spouse, the surviving spouse takes the whole. For purposes of insuring title for prospective owners, a death certificate is typically required to be recorded in the public records to evidence the passing of one of the spouses.
Example: A and B are married. A and B own certain property, as tenants by the entirety. When A dies, A’s interest passes to B.
Creditor protection: Generally speaking, tenants by the entirety ownership, as opposed to the other methods of ownership mentioned above, offers protection of the property against creditors of just one spouse. This protection is in addition to other creditor protections that may be available, such as Florida’s homestead protection against forced sale. If you are experiencing debt issues, you should consult with a qualified consumer bankruptcy attorney, such as Joseph Battaglia, to see if filing for bankruptcy protection may be a good idea for you.
