Saturday, January 11, 2020
In many states married couples have the option to own property jointly and equally in a manner that not only avoids probate like joint tenancy but also eliminates the threat of creditors. This type of ownership is tenancy by the entirety and is available in roughly half of the states and District of Columbia.
Tenancy by the entirety maintains the same right of survivorship as a joint tenancy, but one spouse cannot sell his or her interest without the other’s permission. The creditors of one spouse may place a lien on property held in tenancy by the entirety, but if the debtor dies before the other spouse, the other spouse takes ownership of the property free and clear of the debt. Thus both spouses must sign a mortgage on a property held by a tenancy by the entirety for the mortgage to be valid.
If you live in a state that allows tenancy by the entirety, it may be a good idea to see if the property is in fact owned in that manner. If an unmarried couple buys property and then subsequently marries, they should check if they can re-title the deed as tenants by the entirety to avail themselves of the greater protections this form of tenancy offers.
See Special Ownership for Married Couples: Tenancy by the Entirety, Milvidskiy Law Firm, December 10, 2020.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.