Consult With a Real Estate Attorney About Taking Title

When buying or inheriting a property, you need to think carefully about how you will take title to it, e.g. your legal right to own and use a property. Florida law allows for several ways to own a property, and each one has its pros and cons depending on your circumstances and what you have in mind for that property. A Jurado & Farshchian Real Estate Attorney can walk you through these options and help you decide what is best for your interests.

Sole Ownership

Also known as “ownership in severalty,” this is the most straightforward way to hold title, since it is only in the name of the individual or entity (trust, corporation, etc.) purchasing or receiving the property. For obvious reasons, this method is generally, though not exclusively, used by persons who are legally single.

In the event that a married person takes title to the property as a sole owner, their spouse will typically be made to sign a quitclaim deed that gives up any interest in the property. This is often done when one spouse is engaging in real estate investments that the other is not involved in.

Unlike other forms of taking title, there are no special advantages or tax incentives for sole ownership. Moreover, if the sole owner dies without a will, their property will automatically go through probate and pass through intestate succession to the next of kin (spouse, adult children, etc.)

Ownership in Common

This method is popular for friends or business associates who wish to co-own a property together. Under this arrangement, each owner (also known as a tenant) owns a specified interest in the property that can be proportional — for example, two tenants each owning 50 percent — or unequal, depending on what they agree on.

Regardless of what percentage of interest they own, each tenant in common can sell or convey their interest to whomever they wish. On the flip side, however, the remaining tenant in common may not be like co-owning with the new tenant.

There is also the issue of what happens when owners in common disagree on the sale or conveyance of the entire property. In many cases such disputes will culminate in a lawsuit to bring a partition action that forces the property to be sold and the proceeds to be split among the co-owners proportional to their ownership sales.

Joint Tenancy with Right of Survivorship

As with ownership in common, two or more individuals or entities take title to the same property. However, a joint tenancy with the right of survivorshiprequires that each co-owner have an equal ownership interest and must take possession of the title in the same deed at the same time. This is one reason why this way of holding title is most popular among spouses and relatives.

Another key difference from an ownership in common is what happens upon the death of any joint tenant: when a co-owner dies, their share automatically passes to the surviving member(s) without having to go through probate. Only if all the joint owners die simultaneously will probate be required, since there is no one left to automatically receive the remaining interest.

One big disadvantage to tenancy with right of survivorship is exposure to creditors: if one joint owner has a debt, their creditors may take legal action to force all owners to sell the property to satisfy the debt (regardless of whether the other joint tenants knew anything about it). Moreover, joint owners must all agree on any changes regarding the property, such as taking out a new mortgage or transferring an ownership share to someone else.