Joint tenancy with right of survivorship - A joint tenancy with right of survivorship or JTWROS is a type of concurrent estate in which the joint owners have a right of survivorship, meaning that if one owner dies, that owner's interest in the property will automatically pass to the remaining owner or owners. On the death of one of the tenants, the whole of the property passes to remaining tenant(s); this is the "right of survivorship." The deceased tenant's property interest simply evaporates by operation of law, and cannot be inherited by his heirs (which means it avoids going through probate). Unde this type of ownership, the last owner living takes all.

It is important to note, however, that creditors' claims against the deceased tenant's estate may, under certain circumstances, be satisfied by the portion of ownership previously owned by the deceased, but now owned by the survivor or survivors. In other words, the deceased's liabilities can sometimes remain attached to the property.

This form of ownership is common between husband and wife, and parent and child, and in any other situation where parties want absolute ownership to immediately pass to the survivor. For bank and brokerage accounts held in this fashion, the acronym JTWROS is commonly appended to the account name as evidence of the owners' intent.

In order to create this type joint ownership, the party or parties seeking to create it must use specific language indicating that intent. For example, if Joey wishes to convey property for Kelly and Lisa to share as joint tenants with right of survivorship, Joey must state in the deed that the property is being conveyed "to Kelly and Lisa as joint tenants with right of survivorship, and not as tenants in common."

The four unities - In order for a JTWROS to be created, the co-owners must share the "four unities":
* Time = the property interest must be acquired by both tenants at the same time.

* Title = both tenants must have the same title to the property in the deed - if the deed places a condition on one tenant and not the other, they do not have the same title, and the attempt to create a JTWROS is invalid.

* Interest = both tenants must have the same interest in the property - e.g. three owners each having a 1/3 interest.
* Possession = both tenants must have the right to possess the whole property - if one owner can prove that he or she has been improperly excluded from the property by the other, the JTWROS will be invalidated.

If any one of the four unities is missing, the JTWROS is invalid, and becomes a tenancy in common.

Breaking a JTWROS - The co-tenant in property owned by a JTWROS can break the JTWROS as to their interest in the property at any time by conveying their interest in the property to another person. Under the old common law, this required an actual exchange with a straw man - another person who would buy the property from the co-tenant for some nominal consideration, then sell it back to the co-tenant at the same low price.

Many states now permit a joint tenant to break the JTWROS without a straw man, simply by executing a document to that effect - even if that owner does not inform the other owners. In either case, the JTWROS will, again, revert to a tenancy in common as to that owner's interest in the property.

There is a big problem that is possible with the simple document execution method. In the straw man approach, there are witnesses to the transfer. With the document, there may not be witnesses. With either method, as soon as the break occurs, it works both ways. Because there may not be witnesses, the party with the document could take advantage of that fact and hide the document when the other party dies.

It is important to note, however, that if there are three or more owners, and only one of the owners breaks the JTWROS, the other owners remain in the JTWROS as to each other. For example, suppose Joey, Kelly, and Lisa own a piece of property as joint tenants with right of survivorship, but then Joey conveys his share in the property to Ryan. If Ryan dies, his 1/3 share will go to his heirs. But if Kelly dies, her 1/3 share will go to Lisa, because they still owned their total 2/3 share in JTWROS.

Effect of a mortgage - Where one party takes out a mortgage on the jointly owned property, this may break the JTWROS, depending on the law of the state. Some states use a lien theory, which posits that the taking of a mortgage merely places a lien on the property, leaving the joint tenancy undisturbed. However, other states that use a title theory, contending that a mortgage actually conveys title from the mortgagor [co-tenant] to the mortgagee [lender] until the mortgage is paid. In such states, the taking of a mortgage by one owner breaks the joint tenancy as to that owner. A creditor's judgment lien is not enough, no severance, if debtor dies before creditor sues, the creditor has no interest in the property left to collect against.

Tenancy by the entirety - Tenancy by the entirety is a type of concurrent estate available only to married couples, wherein ownership of the property is treated as though the couple are a single legal person. Like a JTWROS, the tenancy by the entirety also encompasses a right of survivorship, so if one spouse dies, the entire interest in the property passes to the surviving spouse, without going through probate.

In order for a tenancy by the entirety to be created, in some jurisdictions the party or parties seeking to create it must specify in the deed that the property is being conveyed to the couple "as tenants by the entirety". Also, the parties must share the four unities necessary to create a joint tenancy with right of survivorship - time, title, interest, and possession - plus a fifth unity, marriage. However, unlike a JTWROS, neither party in a tenancy by the entirety has a unilateral right to sever the tenancy by the entirety - if it is to be undone, or if any part of the property is to be conveyed to another person, this must be carried out by both spouses. A divorce breaks the unity of marriage, leaving the default tenancy, which may be a tenancy in common. Many US jurisdictions no longer recognize tenancy by the entirety. Where it is recognized, benefits can include the ability to shield entireties property from creditors of only one spouse, as well as the ability to partially shield entireties property where only one spouse is filing a petition for bankruptcy relief. (BACK to Info on Deeds) (Source: click here)

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