We all know property can have one owner or multiple owners. What you may not know is that property can be owned in different ways. When two or more people own property, whether it is land, a bank account or other assets, one way the property can be owned is as joint owners with right of survivorship.
What is the difference between tenancy in common and right of survivorship?
Tenancy in common is the default – it is the type of joint ownership presumed by law absent a written agreement otherwise. If you die owning property as a tenant in common, your share of the jointly owned property passes through your estate to your creditors or heirs. This is in contrast to a right of survivorship scenario, where your share of the property immediately passes to the surviving joint owners upon your death.
Because right-of-survivorship property passes immediately upon death, the asset effectively bypasses the probate process altogether.
How is a right of survivorship in jointly held property created?
The law requires written proof that all joint owners consented to give each other the right of survivorship, but there is more than one way to establish written proof. The right of survivorship can be elected when property is acquired and set forth in the ownership documents, such as a real estate title or banking and investment contract.
A right of survivorship may also be created by agreement. The agreement should clearly state the intent of the parties and should include at least one of these phrases to convey the parties’ intent to the reader:
- With right of survivorship
- Will become the property of the survivor
- Will vest in and belong to the survivor
- Shall pass to the surviving owners
An experienced probate lawyer can prepare documents clearly setting forth the parties’ agreement.
Why would spouses want to have a right of survivorship agreement?
Texas is a community property state, so property acquired during the marriage is generally regarded as being jointly owned by both spouses. When one spouse dies, the community property may pass to the spouse, or may be distributed in part to the deceased spouse’s children, depending on the family structure.
A right of survivorship agreement between spouses does not change the community nature of the property, but in a blended family scenario, it can ensure the surviving spouse gets all the community property rather than being forced to split a portion of it with the deceased’s other heirs.
Create a right of survivorship in your jointly owned property
Establishing right of survivorship is an effective way to avoid probate for some assets, minimizing the expense and hassle of probate for your loved ones. Our experienced Brazos estate planning and probate attorneys at Peterson Law Group look forward to discussing your situation and working together to develop an estate plan to meet both your current and future needs. Contact Peterson Law Group today at 979-703-7014, or visit us online to arrange an appointment.