Holding Title to Real Property as Joint Owners in Illinois

When more than one person takes title to real property, the joint owners will have to decide the nature of the title to their property, which will impact upon each person’s rights. Illinois law allows for title to be held in three ways; as tenants in common, as joint tenants with the right of survivorship, or as joint tenants by the entirety. Each manner of holding title will result in different circumstances of transfer upon the death of an owner and determine the rights of outside creditors to attach the property.

Tenants In Common

This is the most common type of joint ownership. This option allows for the following:

• Joint owners to hold the property in equal or unequal shares, but all owners to have the right to utilize all of the property.
• Each joint owner may sell or transfer his/her separate shares without the consent of the other owners.
• The shares of a deceased joint owner to be transferred to his/her heirs by will or probate court action.
• The shares of a joint owner may be claimed by his/her creditors to satisfy that owner’s debt.

If the type of ownership is not specified on the title or deed, co-ownership is presumed to be as tenants in common.

Joint Tenancy

Another option is for joint owners to hold title as “joint tenants with right of survivorship.” To attain this form of ownership, the owners must all take title to the property at the same time, by the same document or deed, in equal shares and have equal rights to possession of all the property. All other characteristics of this option are the same as tenants in common, with the main difference being that upon the death of one of the co-owners, his/her shares will automatically go to any remaining owners, rather than his or her heirs, without any court probate process. This means that even if a deceased owner’s will designates the property to pass to some other individual, that request will have no effect. This is a valuable characteristic for the remaining owners, as it guarantees that no new persons will have title to their property.

Tenancy by the Entirety

Finally, co-owners of real property may hold title as “tenants by the entirety.” This type of ownership is reserved solely for married couples and is limited to the marital home, providing extra protection to the marital home. This option has all the benefits of joint tenancy, in that the upon death of one spouse, the surviving spouse automatically takes title to the entire property outside of the court probate process, but it also includes the additional benefit of protecting the property from the creditors of one owner. A home held as “tenants by the entirety” may only be reached by creditors of joint debts of the spouses. So, in the case of non-joint debts, a creditor may not divide and sell the property without the permission of both parties. In addition, neither spouse may sell or transfer their half interest without the consent of the other.

The process of transferring title to real estate and setting up various forms of joint ownership can be complex. For advice about the best form of ownership for your situation, please contact the qualified real estate attorneys at The Law Offices of Azita M. Mojarad, P.C. for assistance.