When you own property, it is important to understand a little bit about title and real estate. In today’s post, we will take a brief look at “joint tenancy” and why it is important that you understand how you hold title to your property.
Understanding Title to Real Estate.
How you acquire and hold title to real property has a bearing on your legal ownership of that property. Title affects what you can do with the property during your lifetime (i.e., whether you can mortgage and/or sell it and whether your creditors can reach it). It also has a bearing on how your property is transferred at your death. How you hold title to your real estate can have significant tax consequences as well.
So it is important to understand a little bit about the different ways in which you can hold title to property.
Keep in mind that the laws governing property ownership vary from state to state and that some states restrict the way in which people can hold title to property. So always be sure to consult with experienced real estate counsel where you live.
Georgia Tenancy Laws.
In Georgia, title to real estate is held either singularly or jointly. Joint tenancy exists when two or more people hold title to property concurrently.
Although other types of joint ownership exist, the two most common forms of joint tenancy are:
- joint tenancy with rights of survivorship, and
- tenancy in common.
Tenancy in Common.
A tenancy in common exists when two or more people own title to real property concurrently. This means that each owner has an undivided interest in the property. Generally, tenants in common hold equal interests in the property (i.e.,50/50 or 1/3, 1/3, 1/3 depending on the number of co-owners). However, the interests of tenants in common do not have to be equal.
Holding property as a tenant in common means that you have the right to encumber, sell or transfer your percentage interest in the property. It does NOT mean, however, that when you die, (or when one of your co-owners dies) your interest in the property will automatically transfer to the other co-tenants. It will not. A tenancy in common does NOT carry with it survivorship rights.
In Georgia, unless specific language granting a joint tenancy with right of survivorship is used, all tenancies are presumed to be tenancies in common.
The main difference between being a tenant in common with someone else or a joint tenant turns on the right of survivorship. If you hold title as a joint tenants with the right of survivorship (referred to here simply as “joint tenants”), you have the right of survivorship. In some states, married couples that hold title as “tenants by the entirety” have this survivorship right.
Georgia, however, does not recognize tenancy by the entirety. It does, recognize joint tenancies though. If two married people hold title in Georgia as joint tenants with the right of survivorship, then if one co-tenant dies, the other will automatically inherit his or her interest in the property. Another important fact about joint tenancy in Georgia is that it is not limited to only two co-owners and it is available to non-married parties.
Severing the Joint Tenancy.
The survivorship right that comes with a joint tenancy can be broken or “severed”. Any action taken by a joint tenant that is inconsistent with the joint estate (for example, a joint tenant conveying his interest to another) will “sever” the estate. This means that the co-owners will no longer be joint tenants, but will become tenants in common. And, as noted above, tenants in common do not have survivorship rights.
Real Estate Attorneys in Georgia.
For more than 30 years, the Law Offices of Mark Weinstein has focused on all aspects of real estate law and litigation. We are located in Cumming, Georgia, but we serve clients in and around Atlanta, Marietta, Roswell, Sandy Springs, Kennesaw, Forsyth County, and a number of other counties in Georgia. Call us at 770-888-7707, or contact us here, or send inquiries by e-mail to: firstname.lastname@example.org.