One of the last things a new homeowner thinks about when closing on a new home is how they want to take their title. But it’s important to understand the different ways that a title to residential real estate can be held in the state of Florida, and which option might be right for you. In this blog, we’ll explain the four common ways that people can take the title for a new home in Florida.
In this type of ownership, only one person has a claim to the title and the property. Usually, this type of ownership is used by unmarried people, or married people who are investing in additional real estate outside of their residential home and wish to assume sole title ownership of the property.
While sole ownership is simple, it also lacks benefits when it comes to taxes or estate planning. For example, if a sole owner of a home passes away without a valid will, their property will have to go through probate courts to determine the new owner – which leads to delays and increased costs.
In this type of tenancy, two unmarried individuals are both listed on the title of the home or real property. They are known as “tenants in common.”
These tenants in common both get a percentage of interest in the property. This may not necessarily be equal, and the percentage of each party’s ownership is specified in the deed.
There are no rights of survivorship in this type of property ownership. This means that either of the tenants in common may pass their interest in the property to whoever they wish via their will.
However, this can also lead to complications, such as co-owning property with strangers, and difficulties selling the property if one tenant or the other does not wish to do so. It may also cause complications with creditors.
In this type of tenancy, all co-owners share ownership interest equally, and take the title at the same time. When one tenant passes away, a “right of survivorship” passes their rights onto the other joint tenants.
This helps eliminate probate costs. The surviving tenant(s) can simply provide a death certificate and an affidavit of survivorship to transfer the deceased person’s interest in the property, avoiding probate entirely.
This is the most common type of ownership in Florida, and can only be used by individuals who are married to one another when the property is purchased. Both spouses receive an equal interest in the home.
There is no way to sever this interest as long as both individuals are alive and married. Like joint tenants with right of survivorship, if one spouse dies, their interest in the property can be passed to the other.
Also, creditors from only one spouse may not go after the home, which is joint property. In other words, if one spouse defaults on a debt and the creditor tries to put a lien or take other action against their home, they will not be able to do so.
Only divorce is able to separate tenancy by the entirety. Once the divorce is complete, the ex-spouses will essentially become tenants in common, with separate but undivided interests in the property.
Working with a Florida closing attorney is the best way to make sure you choose the right method of taking your title in a real estate sale. Contact Atlantic Coast Title and Escrow to discuss your options with a lawyer and get the expert advice you need when closing on your new home in Florida.