The laws controlling real property ownership can be complex and specific. This is because land, and the improvements made to it, are valuable and unique. State laws provide different forms of ownership. Co-ownership or concurrent ownership is when more than one person owns land.
Three main forms of concurrent or co-ownership of land are:
- Joint tenancy
- Tenancy in common
- Tenancy by the entirety
Both joint tenants and tenants in common enjoy the right to possess and use the whole of the property.
Joint tenancy is a form of co-ownership whereby two or more people own land and share what is known as the right of survivorship. The right of survivorship means when one joint tenant dies, his or her share automatically passes to the surviving joint tenant.
The joint tenancy is a popular form of co-ownership because there is no need for a will or probate. Probate is the often time-consuming and costly legal process to settle someone's affairs after death and transfer the deceased person's property as directed by a will or state intestacy law if there isn't a will.
Tenancy in Common
Tenancy in common refers to a form of shared ownership where two or more persons own land without the right of survivorship. Here, when a tenant in common dies, that owner's interest in the property passes to his or her heirs or those named as beneficiaries in the owner's will.
Tenancy by the Entirety
Tenancy by the entirety is a way for a married couple to hold title to property. This marital interest is recognized in less than half of the states and is limited to the couple's home. This form of ownership gives the right of survivorship, like joint tenancy.
The key benefit to this ownership type is protection from creditors. A creditor can't look to the property for payment on a debt unless both the husband and the wife agreed to it. The benefit of this ownership type is seen in situations where one spouse may try to borrow without his or her spouse's knowledge. Gambling or business loans are good examples.
Questions for Your Attorney
- Can co-owners change their form of ownership without affecting mortgage loans? Can my spouse and I change from joint tenancy to tenancy by the entirety?
- Can a deed place restrictions on co-ownership, for example, how you must sell or transfer your share if you're a tenant in common?
- How does joint tenancy work with other laws? For example, can my mother and I own a house as joint tenants, and avoid any claims on the house by her spouse?