How you hold the title to your property is an important decision. Choosing between a Joint or Individual Title requires that you understand your options.
The title to your property may be held by yourself alone (solely in your name) as an Individual Title, as a Joint Tenancy or as Tenancy in Common. Deciding which is best for your situation is a decision that not only affects you in the present day, or even in your future, but could impact what happens to your property after you die.
What do the different categories of title mean?
If the title has only your name, no matter how many other people share ownership with you, the tile is consider an Individual or a Sole Ownership Title.
If you hold the title with someone else, the title is considered a Joint Tenancy. When one of you named on the title dies, the property passes directly to the other without passing through probate. The survivor just files an affidavit about the death of the other owner and provides a copy of the death certificate and the property
passes on to the survivor with no further action. This is called “the right of survivorship”.
If you hold the title as legal spouses in the state of Florida, however, it is deemed a tenancy “by the entirety”. You can’t in Florida, end a Joint Tenancy simply by conveying your interest in the property to someone else, as is permissible in some other states. Both spouses must participate in the transfer if
you wish to transfer your interest in the property.
Another way to hold a Joint Title is called Tenancy in Common. The title is held in several names, but when one of the people listed on the title dies, the deceased’s interest gets distributed as they have indicated in his or her will. In the absence of a will, the deceased’s interest gets distributed according
to the law of the state.
More about Joint Title
Here are more ins-and-outs of holding Joint Title.
If only one of the owners of the property would be able to qualify for a mortgage, their name won't be on the original title. To be added later, the person whose name is on the title records a “quitclaim” deed after closing. This comes into play when a married couple wants to own their property separately. Be cautious, though.
In some states, if a person’s name isn’t on the title, they forfeit the right to share any profits or exert any control over the property.
In some community property states, only legally married people can hold title jointly as community property. Half the ownership transfers to the heirs when one spouse dies, (unless the title is held as community property with the right of survivorship.) In some other states, it is even possible for the spouse not named on the
title to get a community interest in the property.
Trusts, Corporations and Partnerships may also (as legal entities) own property, but there may be detrimental tax consequences to be considered.
Restrictions on how titles may be held as either an Individual Title or Joint Title differ from state to state and can affect ownership and transfer of property after the owner’s death. It is best to discuss Joint or Individual Title decisions with your real estate attorney.
Information on Joint or Individual Title may be found at www.alta.org.