The Effects Of A Death On Your Title

By Sabrina Biehl Published May 20, 2014 08:36 am Updated Feb 3, 2015 10:48 am

Question: My mother died a couple of months ago, and my dad wants to make sure that title to his house is in his name. How do we determine the status of title? Dad wants to make sure that upon his death, his three children will not have any problems regarding the house.

Answer: First, while I am sure that your motives are pure, you have to remember that the decision on where to distribute your dad’s assets when he dies is his — and his alone — to make.

The answer to your question depends on how your parents held title. You can ask an attorney to do a title search or you may be able to go to the website of the local recorder of deeds in the county (or city) where the property is located and get a copy of the original deed to the house.

There are several ways that property can be owned:

Sole owner. This is obvious; you own the property in your own name.

Tenants in common. Here, two or more people own property together. Under a tenant in common arrangement, each owner has a divisible interest in the property. Although most tenant in common ownerships are split equally (i.e. 50-50 ownership), there is no legal requirement that it has to be this way. Often, there are financial or other considerations which dictate a different ownership split — for example 90- 10, or 75-25. For example, parents may buy a house with their children and split up ownership in accordance with a formula they decide upon.

In this arrangement, on the death of one owner, his/her percentage ownership is part of the decedent’s estate — and the estate must be probated. The property interest does not transfer to the surviving owner. If there is a Will, that portion of the property will be distributed in accordance with its instructions. If the person dies without a Will (called “intestacy”) the laws of the jurisdiction where the person was domiciled will control the distribution.

Joint tenants: here, the parties jointly own the property. Although some states require language to the effect that the property is held as joint tenants “with right of survivorship”, the majority of the States will consider the property as being jointly held even if this magic language is not included in the deed.

Under a joint tenancy arrangement, on the death of one owner, the property will automatically be transferred to the surviving joint tenant. Probate is not necessary. This is called a transfer “by operation of law”. Let’s look at this example: A and B own property as “joint tenants with right of survivorship”. A dies with a Will which specifically gives A’s share of the property to C, his child.

However, since the property is jointly held, B will end up with full ownership. C has no claim to the property, and the Will — as it relates to the property — is meaningless.

A joint tenancy ownership can, however, be unilaterally separated by one of the joint tenants. Let’s go back to our example. While A is alive, he decides that on his death, his share of the property should go to C. He prepares a Last Will and Testament memorializing his intentions. But he also asks his attorney to prepare a deed, changing title to reflect that A and B will now hold title as “tenants in common”. Although B should be informed — as a matter of courtesy — of this transaction, B has no control over what A does with his share of the property. Now, when A dies, his interest will be distributed to his child C, in accordance with the terms of the Will. Since they now own the property as tenants in common, probate will be required.

It should be noted that some states allow joint tenants to own the property in unequal shares, but in the Washington metropolitan area, property must be held in equal shares.

Tenants by the entireties: this is title reserved exclusively for husbands and wives. Although some married couples will hold title as joint tenants with right of survivorship, the more common arrangement is to take title as tenants by the entireties. This means that on the death of one spouse, the surviving spouse automatically (by operation of law) becomes the owner of the entire property. Probate is not required.

Title ownership is important in life as well as in death. If, for example, there is a creditor who holds a judgment against one of the joint tenant owners, that creditor can force the sale of the property in order to satisfy the judgment. Let us assume that the judgment creditor is owed $25,000 by one of the joint tenants, and the jointly held house is worth $400,000, with a $200,000 mortgage. The judgment creditor can get a Court Order requiring that the house be sold. The first mortgage lender will get its $200,000, and the remaining sales proceeds (after commissions and closing costs are deducted) will be divided as follows: the joint tenant who did not owe any money will get half of the balance but the judgement debtor’s share will be deducted in order to pay off the $25,000 debt.

However, when husband and wife hold title as tenants by the entireties, a judgment creditor of only one of the parties cannot force a sale to satisfy the debt. This can only be done if both husband and wife owe the money.

Some married couples decide — for tax or estate purposes — that the house will only be titled in one of the parties. There are advantages and disadvantages to this, and legal and financial advice must be obtained before going this route.

Thus, the way title is owned can be important — whether you are living or are dead.

Assuming that your parents held the property as tenants by the entireties, your father is now the sole owner. The land records, however, will still show ownership in both names. While it is not critical to have the title placed solely in the name of your father, it is not an expensive process to update the records, and it may solve problems which could arise in later years.

Your father will need a certified copy of your mother’s death certificate. This means that the certificate will have an imprinted Seal from the government office which issues such certificates. He will then have to record a document — called a “confirmatory deed” — in the office of the Recorder of Deeds in the jurisdiction where the property is located. There should be no recordation or transfer tax, and the filing fee should be nominal, perhaps $20 or $30.

Some local jurisdictions may require some additional documentation — such as an affidavit of exemption from tax.

Why should your father make sure that title is in his name? Peace of mind is perhaps the most important factor. Additionally, many years later, should the need arise to sell or refinance the property, you may not be able to locate your mother’s death certificate. The title company or attorney handling the transaction will require proof that your mother died.

Finally, a number of states have enacted the Transfer on Death Deed. Check with your attorney; it your state has that law, it is something that your dad may be interested in. Oversimplified, you prepare a deed that does not become effective until you die. It’s not that simple, however, and you need legal counsel to assist you with this.