Mortgage vs. Deed
It is a common mistake for people to believe that a mortgage determines ownership of a property. It is actually the person(s) on the deed who is the owner regardless of the name(s) that is on the mortgage.
How the deed is titled and who is on the mortgage makes a significant difference in what happens in the event of a divorce/legal separation or a death. This article discusses ownership. If you have two or more persons on a deed it can make the transfer of property upon death more difficult. Property can be held as joint tenants or as tenants in common. If the deed does not specifically state that title is held as joint tenants, then automatically, property is generally held as tenants in common if there are more than one person listed on the deed. Property that is held as joint tenants means that the survivor of the property owners automatically owns the deceased person’s interest. So, if Tom and Jerry are on the deed as joint tenants, and Tom dies, Jerry owns the entire property. In contrast, if the deed does not specifically state that Tom and Jerry are joint tenants, then automatically they are tenants in common. That means that if Tom dies, Tom’s interest must be probated, and it will go according to Tom’s will or if he does not have one, Tom’s interest will be given to the person(s) whom the legislature has decided will inherit Tom’s portion via the intestate statute. To complicate matters further, if the person who gets Tom’s portion, whether it is via a will or via the intestate statute is neither a spouse of Tom nor Tom’s child, then Tom’s one-half interest in the home is subject to creditor claims, if any.
Spangler and de Stefano, PLLP advises individuals and business owners about ownership of real property.
The material contained herein is for informational purposes only, and is not intended to create or constitute an attorney-client relationship between Spangler and de Stefano, PLLP and the reader. The information contained herein is not offered as legal advice and should not be construed as legal advice.