It’s not unusual for an unmarried couple to buy a house or other property together. Usually, they do this as tenants in common. (You can check this on your deed or title insurance policy.)
- In a tenancy in common, each owner owns a share of the same undivided property. Each owner may, in the absence of any agreement with the other owner, sell, mortgage or otherwise deal with the property during their lifetime. The owners have no right of survivorship, meaning that if one dies, that owner’s interest in the property will be part of the owner’s estate and pass by inheritance to that owner’s heirs, and not the other owner.
The tenancy in common can be contrasted with a tenancy in the entirety and a joint tenancy.
- A tenancy by the entirety is generally available only to married couples; ownership of property is treated as though the couple were a single legal person. Neither spouse can sell, mortgage or otherwise transfer the property without the other spouse’s consent. A tenancy by the entirety includes a right of survivorship; if one spouse dies, the entire interest in the property goes to the surviving spouse without going through probate.
- In a joint tenancy, each owner also owns a share of the same undivided property. A joint tenancy includes a right of survivorship. However, each owner can sell, mortgage or otherwise deal with the property without the other owner’s consent.
Now, let’s get back to our couple. They decide to marry and think it’s important that neither one can sell or mortgage the property without the other. And that they have rights of survivorship; if either of them dies, the property passes to the other, not the decedent’s heirs.
The solution is simple in many states. You file a deed vesting the property in the owners as tenants in the entirety. This works in New Jersey and Pennsylvania and the other 23 (or so) states that allow tenancies in the entirety.
But some states like California don’t permit tenancies in the entirety. In those states you can file a deed vesting the property in the owners as joint tenants — creating a right of survivorship — and, if you wish, enter into agreement between the owners to restrict transfers of the property.
It may be time for you to record a new deed. But be careful. You don’t want to lose the benefit of the title insurance policy you purchased for when you bought your property. In addition, you’ll want to make sure that the recording of a new deed does not violate the terms of your mortgage.
As I write this, mortgage rates are at recent lows. It might be a good time to refinance that mortgage.
I’d recommend speaking with your attorney. If you don’t care to do that, at least review your mortgage and speak to the agent that issued your title insurance policy.
Alan N. Walter