How to Hold Title With Multiple Owners

Whether it is with a spouse, friend, business partner, or relative, there may come a time when you will take ownership of a property along with someone else. This is known as joint property ownership or concurrent ownership, and it has several implications for how the property can be sold, used, repaired, or bequeathed as part of an estate. It is, therefore, crucial to consult with a Jurado & Farshchian Real Estate Attorney before deciding if or how to take title with one or more parties.

In particular, there are three main types of joint ownership recognized in the State of Florida, each one having distinct advantages and disadvantages. Take a moment to consider these options while planning what you will do with a property and with whom.

Tenancy in Common

This is the most common form of concurrent ownership (tenancy) for unmarried people, giving two or more people an undivided interest in the same real property. This means each owner (a.k.a. tenant) has the right to own and use the entire property, regardless of the size of their undivided interest (which may be allotted evenly or disproportionately). Owners can individually sell, transfer, or otherwise dispose of their interest in the property however they choose.

While this is the most unrestricted form of concurrent ownership, it does have its potential problems and drawbacks depending on what arrangement you have in mind with your fellow owner(s). Each owner will be responsible for paying property taxes, liens, assessments, repairs, and other related expenses in proportion to their undivided interest. Owners failing to meet their respective obligation may end up in a legal dispute.

Moreover, tenants in common must all agree to allow one another to freely use and live in the property. So if there is ever any conflict or falling out between the owners, and one owner wishes to deny entry or possession to the other, legal action would have to be taken for either party to regain full possession. Whatever personal gripes you have will not change anyone’s legal rights unless you sign an agreement or go to court to do so.

Another typical point of contention is what happens when one tenant wishes to sell the entire property, but the other one does not. If they cannot come to an agreement, then once again the court would need to get involved, with the possible remedy being that the owners must partition the property amongs themselves, with each being in sole possession of their respective part.

However, if physically portioning the property is seen by the court as being damaging to the other owner, then the court could order the whole property to be sold, and the proceeds divided up between the owners in proportion to their undivided interest.

Joint Tenancy with the Right of Survivorship

This is very similar to a tenancy in common, and has all the same characteristics with one major exception: if one owner dies, the survivor automatically gets that owner’s share in the property – even if the decedent’s will or Florida’s law of intestate succession say otherwise. This form of concurrent ownership is most popular for married couples and between family members (namely parents and children).

In the case where the ownership interest is among three or more joint tenants in unequal shares, the share of the deceased tenant is by default divided among the survivors based on their respective portions (unless the deed says otherwise).

Bear in mind that a joint tenant can still decide to unilaterally sell or transfer their interest to a third party – whether or not the other owner knows or approves – thereby severing the joint tenancy with the right of survivorship under Florida law, and making it a joint tenancy in common. As with a tenancy in common, there can be disagreements over what to do with the property that may end up needing to be settled in court.

Another point of contention regards what happens when one joint tenant owes a debt. Creditors can put a lien on that joint owner’s interest in the property or successfully sue them for what’s owed, leading to a court judgment being filed against the property.

Once again, it doe not matter whether the debt-free joint tenant had anything to do with their co-owner’s debt, or whether or not they even knew about it. In fact, if a court rules for a creditor to be paid through a sale of the home, this will not only sever the joint tenancy with the right of survivorship, but the debt-free co-owner may end up as a joint tenant in common with the creditor or another third party.

Tenancy by the Entirety

Also called tenancy by the entireties or estate by entirety, this form of joint ownership is restricted solely to legally married couples, in which both spouses are treated as a single unit. Thus, instead of each person owning a partial undivided interest, each is legally considered to own the entire property.

Under Florida law, this confers three major benefits:

Probate Avoidance – Because each spouse owns the property in its entirety, if one passes away, the survivor automatically owns the entire property without it having to pass through probate.

Mutual Consent – All decisions made on the property, such as a sale or transfer, must be signed off on by both spouses. Any sales contract, mortgage, or deed must be signed by both spouses to have any effect. Thus, each spouse is protected from having anything happen to the property without their individual consent.

Protection from Creditors – Unlike other forms of concurrent ownership, a property held in a tenancy by the entirety cannot be saddled with a judgment or lien. In the event that one spouse is sued, the subject property is completely off limits for satisfying a judgment.

For the above-mentioned reasons, a tenancy by the entirety is highly recommended for owners who are married.

How a Real Estate Attorney Can Help

As should be apparent by now, taking title to a property with one or more owners is not something to be done lightly or without relevant legal expertise. A Jurado & Farshchian Real Estate Attorney can provide you with honest and informed advice on the best way to own a property based on your needs and circumstances.

Please call 305-921-0440 or email [email protected] to learn more about our services.

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