Joint tenancy is a legal arrangement where two or more individuals co-own a property or Asset.
Joint tenancy offers the Rights of Survivorship which means that if one of the Joint Tenants passes away, their ownership share automatically transfers to the surviving joint tenants without the need for Probate or a Will.
Joint tenancy helps simplify the transfer of an asset after a death, making the process faster, cheaper, and ensures that the surviving co-owner seamlessly continues to own the property.
Key points about joint tenancy include:
Equal Ownership: Joint tenants have equal ownership shares in the property. Regardless of the financial contributions of each tenant, they all have an equal stake in the property.
Seamless Transfer: The defining aspect of joint tenancy is that the surviving joint tenants automatically inherit the deceased tenant's share. This happens without the share becoming part of the deceased tenant's estate or going through the probate process.
Unity of Ownership: Joint tenancy is established through the unity of time, title, interest, and possession. All joint tenants acquire the asset simultaneously, with the same ownership type, equal interests, and the same rights to possess the asset.
Survivorship: When a joint tenant passes away, their ownership share immediately transfers to the surviving joint tenants. This can be a spouse, family member, or partner who co-owned the property.
No Will Involvement: The right of survivorship in joint tenancy means that the deceased joint tenant's share doesn't go through their will. Instead, it directly transfers to the surviving joint tenants as a matter of law.
Termination and Conversion: Joint tenancy can change if a joint tenant sells or transfers their share during their lifetime. This action can convert the joint tenancy into a different form of ownership.
Common Uses: Joint tenancy is often used in real estate ownership between spouses, family members, business partners, or other individuals who want to ensure a smooth transfer of ownership after a death.
It's important to consult an Estate Attorney when considering a joint tenancy's financial and legal implications.