Making Sense of Joint Tenancy

Joint Tenancy and Rights of Survivorship

Two or more people may acquire real property or purchase assets in joint tenancy. Co-owners cannot sell, transfer, assign or gift assets jointly owned unless the courts order the action or unless all joint tenants give their consent.

Joint tenants further hold rights of survivorship, meaning surviving tenants will immediately and equally become owners of another co-tenant’s property interest upon death.

Joint Tenancy Benefits

Right of survivorship is the biggest advantage for undertaking joint tenancy. Real property deeds and asset titles in joint tenancy are further inexpensive to set up and easy to execute. Properties legally passed to joint tenants via right to survivorship also avoid probate proceedings as well.

Disadvantages of Joint Tenancy

Aside from joint tenants occasionally disagreeing on how to manage co-owned property, other inconveniences exist when co-owning assets.

Will Challenges. Estate disputes may arise if the provisions in a deceased co-tenant’s will conflicts with the right of survival interest of other joint tenants.

For example, say a husband purchased a home in joint tenancy with his wife, but before he died, he forgot to alter a will that leaves all his property to his children.

Iowa probate code affirms provisions established in estate planning testamentary documents that attempt to end lawful joint tenancy have no legal effect.

This means only the wife can claim the husband’s interest in the home, but should the children file an estate dispute claim, the wife must hire an expert probate litigator to protect her property rights in court.

Creditor Liability.  Probate statutes in Iowa hold that a deceased joint tenant’s debts on the property conveyed to other co-owners become the responsibility of the survivors.

For example, say a creditor secured a lawful equity lien on a co-owner’s property before he died. The creditor may consequently make a claim against the survivors’ estate after the decedent's property interest transfers to the co-owners.

The surviving joint tenants must ultimately pay the deceased co-owner’s debt or risk the creditor seizing their property.

Unavoidable Probate

Property and assets owned in joint tenancy go through probate only when certain circumstances take place.

If the last joint tenant dies, his heirs will inherit the co-owned property unless the deceased executed an alternate probate-avoidance instrument before his death (i.e. living trust).

Heirs may similarly inherit co-owned property or assets if in the unlikely event all joint tenants die simultaneously.

Co-owned assets may further head to probate if the courts find the joint tenant never intended to pass the right of survivorship to co-owners after death.

Intent Decides Estate Dispute Claims

Will dispute litigation often asks, what did co-owners intend when entering into their joint tenancy agreements? Once the decedents’ intentions are clear, it’s easy to recognize who will take the property in controversy.

When adjudging joint tenancy dispute claims, probate courts will look at evidence that establishes whether the joint tenant intended to give co-owners an equal interest in the property at the time of acquisition.

If proof reveals the joint tenant intended to pass the right of survivorship to his co-owners, the will challenger’s claim is invalid at law and the survivors take.

The law will contrarily presume the co-owners held a “tenancy in common” when will challengers prevail in proving the deceased intended for the heirs to take.

Property held by tenants in common must enter probate where legal successors will inherit the asset.