In the last post I generally discussed the attractiveness of a transfer on death deed. It is an efficient means by which to pass the house down to loved ones by avoiding probate. This post addresses an issue that arises when real property is held as joint tenants with right of survivorship.
Co-ownership in property can become a complex situation. Many individuals find themselves in a similar situation. One of these common situations occurs when co-owners of real property hold ownership as joint tenants with right of survivorship. This type of ownership involves a seemingly infinite number of implications. I will only address one today.
First, what happens when a joint tenant passes away? When a joint tenant passes away, the surviving joint tenant(s) retain(s) ownership of the entire property. For instance, if Alan and Bill own land as joint tenants with right of survivorship, and Alan dies, Bill would keep the land solely in his name. Nothing would pass through to Alan's heirs or devisees. Like the transfer on death deed, a result of holding property as joint tenants with right of survivorship is that the property passes outside of probate.
But, secondly, what happens if Bill, now having sole ownership of the land, wishes to execute a transfer on death deed so that the property avoids probate? He does not want to grant ownership in the house prior to his death, but he does not want his beneficiary to wait through the probate period to acquire an ownership interest in the land.
The second question is difficult because on the books of the recorder's office, the property may still be listed as owned together by Alan and Bill as joint tenants with right of survivorship.
An attorney should draft an affidavit of survivorship that lets the people at the courthouse know that Bill now is the sole owner of the property. This will allow Bill to execute the transfer on death deed, avoiding probate while retaining sole ownership in the property during his life.
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