How Should You Take Title When Purchasing Property Jointly?
By Cody McCaughan, Esq.
Forms of Title
The manner in which title is held is known as title vesting, which refers to the legal rights to the home you own. If you are purchasing property by yourself, the options to take title are simple, i.e., “a single woman,” “a single man,” “a married woman,” “a married man.” When you purchase property with someone else, there are multiple ways you can hold title, each of which has important legal implications for the owners. Florida law recognizes three forms of joint ownership. Buyers purchasing property jointly can take title in one of the following ways: (1) tenants in common; (2) joint tenants with right of survivorship; or (3) tenants by the entireties.
Tenants in Common
Tenancy in common is the default form of co-ownership in Florida. In the event of one title holder passing away, property held in a tenancy in common passes to the heirs of the deceased owner. A downfall of tenancy in common is that if one of the owners dies, the property must go through probate. Additionally, a joint owner can transfer their interest in property without affecting the other party’s ownership interest. Tenancy in common does not provide asset protection against creditors.
Example: Person A, a single man and Person B, a single woman as tenants in common. Upon the death of Person B, Person B’s half-interest would pass under their will or under Florida’s intestacy statute if there is no will.
Joint Tenants with Right of Survivorship
Joint tenancy with right of survivorship permits the last survivor to take full ownership of title upon the death of the other co-owner. This process can be convenient if the intent of the parties is to hand off ownership to the other title holder after their death and without the need to probate the property. This can be an issue if the deceased owner desired for their asset to go to their heirs and not the other co-owner. Importantly, joint tenancy with right of survivorship also does not provide asset protection. To create a joint tenancy with right of survivorship, it must be expressly stated in the instrument. Fla. Stat. § 689.15 (2021).
Example: Person A, a single man and Person B, a single woman as joint tenants with right of survivorship. Upon the death of Person B, Person A would take 100% ownership of the property and avoid the probate process.
Tenants by the Entireties
Tenants by the entireties is solely reserved for married couples and is assumed in Florida where a property is owned by husband and wife. Beal Bank v. Almand & Assocs., 780 So. 2d 45, 54 (Fla. 2001). This requires the consent of each individual to sell the property and it also creates a right of survivorship. When one spouse dies, the surviving spouse gains full ownership of the property. The importance of being vested tenants by the entireties is that it provides a non-statutory protection against creditors. Intent to hold ownership as tenants by the entireties simply requires the marital statuses of spouse co-owners in the deed.
Holding title as tenants by the entireties requires six unities. Absent one of these unities, ownership as tenants by the entireties is invalid and the property is subject to creditors. If the parties divorce, one of the unities fails and the title ownership converts from tenants by the entireties to tenants in common. To create a tenancy by entities, there must be:
- Unity of Possession (joint ownership and control);
- Unity of Interest (the interests in the account must be identical);
- Unity of Title (the interests must have originated in the same instrument);
- Unity of Time (the interests must have commenced simultaneously);
- Survivorship; and
- Units of Marriage (parties must be married at the time the property became titled in their joint names).
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