Co-owning Property with Your Spouse or Children – How To Chose the Right Type of Ownership
November 18, 2006
There are three principal types of ownership (tenancies) relative to real estate. The most familiar is what is known as joint tenants. This means that if one person dies, the other person automatically owns all of the interest in the property.
There is no requirement or limit as to how many people may be co-owners on a property. So, if a husband and wife add their two children to the deed, they are each then presumed to own a one-fourth undivided interest in the entire property. If any one of those individuals dies, then the remaining three owners will each own a one-third interest. This interest does not pass through probate since joint ownership is a means of avoiding it.
One disadvantage with joint tenancy however, is that if any one of the joint owners is sued, then his or her interest is attachable by creditors. In addition, any one of the co-owners, or possibly one of their creditors, may bring an action to divide the interest in the property and force the other owners to sell. This is called a petition to partition proceeding, which in most states is allowable even if there are owners holding the property as joint tenants with rights of survivorship.
Also, any one of the owners may “break” the title by deeding his or her interest to another person in lifetime. This would cause the new owner to hold the property as a tenant in common with the other three owners.
A tenancy in common…
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by: Hyman G. Darling, Esq.