I will often hear clients ask about survivorship deeds. Many people are unaware that their deeds are not survivorship deeds. There are two main forms of real property ownership in Ohio: tenants in common and survivorship. Both forms of ownership have their pros and cons.
Jointly owning real property as tenants in common means each owner has an undivided, fractional share of the property. This form of ownership is better suited for friends or couples who are not married. For example, if two owners own real property as tenants in common, they will each own two undivided 50% interests. If owner number one dies, his/her interest will have to go through probate. If his/her will devises the intereset to owner number two, then owner number two will own the entire property. However, if property owner number one's will devises his/her interest to third party, then third party and property owner number two will both own the real property. Owning property as tenants in common is the default way to own real property in Ohio. It is an advantageous form of ownership for people who don't necessarily want their interest in the property to pass to the other property owner. However, it can be a problem when a co-owner dies and the second co-owner is stuck owning the property with the first co-owner's devisee which could potentially lead to a partition action in the local county court.
A survivorship tenancy is similar to tenancy in common, except that the owners have a right of survivorship. That is, when one joint owner dies still owning his/her share, the share passes automatically to the surviving owner. Jointly owning property in survivorship is better suited for married couples because it can be used as a mechanism to avoid probate. Lets look back to the two property owners from the above example. If property owner number one dies, his/her interest will automatically pass to property owner number two. All property owner number two has to do is file an affidavit with the local recorder stating that property owner number one died. Owning property in survivorship is advantageous because it can avoid probate. However, it can be a problem when a co-owner dies, and his/her interest unintentionally passes to the other co-owner.
Many people think they have a survivorship deed, but in reality they do not. A survivorship deed must contain the "magic" language: "for their joint lives, remainder to the survivor of them." If your deed does not contain this language, it is not a survivorship deed. If you would like to consider the possibility of creating a survivorship deed, come visit me at my office in Parma Heights, Ohio. I would be glad to discuss how a survivorship deed may be right for you.