When you bought your home, did you give much -- or any -- thought about how you'd title it?
"Many homeowners don't think about it," says Matthew Drewes, an attorney at Thomsen & Nybeck in Bloomington, Minn. "Some don't even realize there are options until they show up at closing and are asked how they'd like their deed to read. At that point, they're pretty much on their own. Title companies are reluctant to give advice, and frequently you're dealing with a closer who's not well-versed in title issues."
How you title your home shouldn't be an afterthought. "It's important so that your interest in your property goes where you want it to go at your death," says Nancy Polomis, chair of the real estate development department at Hellmuth & Johnson PLLC in Eden Prairie, Minn.
Here's a primer on common ways to hold title to your home, along with tips for figuring out which is best for you.
Title basics you should knowThere are several common ways to hold title to your home. You can hold it solely in your name, in joint tenancy or as tenants in common.
Sole ownership is just what it sounds like: You hold the title in your name alone, even if you own the property with other people. The second option -- formally called joint tenancy with the right of survivorship -- is a way to hold title in more than one person's name.
"Joint tenancy means that you and I own the property together, and if one of us dies, the other gets it without the property passing through probate," says Polomis. "The survivor files an affidavit saying the other titleholder is dead, attaches the death certificate and gets the property."
Tenancy in common is another method for holding title in several names. "With tenancy in common, you and I own the property together," says Polomis. "But upon my death, my interest is distributed according to my will or if I don't have a will, according to state law."
Some states have variations on joint tenancy. "In Florida, when you take title as husband and wife, it's deemed a tenancy by the entirety," says Roberto Blanch, an attorney at Siegfried, Rivera, Lerner, De La Torre & Sobel PA in Coral Gables, Fla. Tenancy by the entirety is joint tenancy with twists. You can end a joint tenancy simply by conveying your interest in the property to another person. With tenancy by the entirety, however, you can't transfer your interest unless you and your spouse participate in the transfer.