1

What are the practical differences between opening a joint bank account with one's spouse in these ways:

  1. Joint tenants
  2. Tenants in common
  3. Joint tenants with right of survivorship?

I am concerned with the implications if one spouse dies. Does this differ by bank or by state? (I am in NY.)

3

Right of survivorship means that if one of the coowners dies, the other person immediately gets the ownership without having to go to probate. If a ownership is without the "right of survivorship", then the portion owned by the deceased falls to the estate and must be handled via the will or the probate. For example, if two non-related people own property in joint tenancy without rights of survivorship then that portion of the property would go to the heirs when the estate is settled. On the other hand, right of survivorship would mean that the partner would get the property automatically. Note that technically Joint Tenancy could mean without the right of survivorship. One would have to check within the individual jurisdiction to determine if with or without is assumed if not stated explicitly. That is why it is always best to put it into the contract.

What Is the Difference Between Joint Tenancy & Tenants in Common?

Survivorship

Married couples should pay extra attention to the way they take title when purchasing a home, since not every way has the right of survivorship. The right of survivorship means that if one owner dies, the other owner automatically owns the property without it having to go to probate. According to Realty Times, only joint tenancy has the right of survivorship. If a tenant in common dies, her whole estate, including the home in which she owned a part, must be divided according to the rules of the probate court.

The rules of Joint Tenant and Tenant in Common differ in how the individual portions of the property would be handled.

Joint Tenancy

Joint tenancy is a type of homeownership where everyone on the title has an undivided interest. For example, if a husband and wife are on title to the house as joint tenants, they both own equal and undivided shares of the property. According to Realty Times, one or more of the joint tenants may destroy the joint tenancy by selling his ownership position in the property to another party, resulting in a type of ownership called tenants in common.

Tenants in Common

Tenants in common is a more informal method of taking title in which each owner owns a specific percentage of the property. If there are two owners on the title, each could own 50 percent of the property, or one tenant in common could own a greater percentage than the other. Realty Times states that if no form of ownership is specified when a house is purchased, courts in the United States tend to assume the intention was to be tenants in common.

Massachusetts has stated that a Joint Tenancy must be stated on the original purchase. Tenants in Common can purchase their segments at different times and using different deeds.

  • What you haven't addressed, is the difference between "Joint Tenancy" and "Joint Tenancy with right of survivorship". (Your answer agrees pretty much with how the law works in England and Wales.) – Martin Bonner Sep 26 '16 at 15:16
  • @MartinBonner My first paragraph deals with that. "Joint Tenancy" does not have right of survivorship assumed. I will add a sentence making it clearer. – sabbahillel Sep 26 '16 at 16:11
  • Ah. In that case, that is different to E&W. We only have "JT with right of survivorship". "without" is unknown to us. – Martin Bonner Sep 26 '16 at 16:42
  • Your quoted survivorship paragraph specifically states that "only joint tenancy has the right of survivorship." This doesn't match the statements elsewhere that joint tenancy doesn't automatically include "right of survivorship." – mkennedy Sep 26 '16 at 17:37
  • @mkennedy The way I read that statement is that "only joint tenancy" has the right of survivorship (to exlude tenants in common) but even that does not necessarily include survivorship. That is, there can be joint tenancy that does not include survivorship. That is why the warning to ensure that it is explicit in the contract. – sabbahillel Sep 26 '16 at 17:41

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