When a spouse or a loved one passes on, most families must begin a legal process called probate. Probate procedures help distribute the deceased person's estate and debts to heirs and designated beneficiaries.
This process can take the family up to nine months, so avoiding it all together may make a world of a difference during an emotionally difficult time.
One popular method for avoiding probate in New Jersey is for families to set up ownership of property under a joint tenancy or tenancy by the entirety title. Both options are helpful ways to avoid probate because they allow the shared property to be automatically inherited at the time of one owner’s death.
A joint tenancy allows people to share property equally. When one owner dies, the surviving co-owner automatically inherits the property through the right of survivorship — eliminating probate procedures.
The tenants/owners must comply with these four requirements to hold the joint tenancy title:
- Take possession of the property at the same time
- Take the title on a deed or will or any legal document establishing the transfer of property
- Do not take additional ownership stake. Each tenant/owner shares equal interest in the property
- Maintain the right to possess and enjoy the entire property at any time for all tenants/owners
Tenancy by the entirety
Tenancy by the entirety is similar to a joint tenancy, except it only applies to married couples. The couple shares equal interest in property and the surviving owner automatically receives the entire interest in the property (without probate proceedings being necessary).
Another key difference between the two types of titles is that joint tenancy can end if one owner sells an interest in the property. Neither spouse can sever tenancy by the entirety, except through divorce.
For more estate planning advice, consider asking the opinion of an experienced attorney. Collecting important estate documents, understanding different types of trusts, and making estate changes are just a few examples of issues that an experienced lawyer can help guide you through.