When more than one person owns property together they usually own it in equal parts. When one of the owners dies, this leaves the other owners needing to know how this will affect their ownership. The answer will depend on whether the property had something called survivorship.
What is Survivorship?
Survivorship means that if two or more people are owners of something and one of the owners dies, the remaining owner or owners automatically become the owners of the deceased person’s share. This term is commonly associated with real property ownership and to joint bank accounts. Survivorship ordinarily needs to be mentioned in the legal documents conveying the property or establishing the account, but there are some exceptions.
Real Property
In Michigan, survivorship of real property interest is usually part of what is called a Joint Tenancy with Right of Survivorship. What that means is that when two or more people own property together and one of the co-owners or “joint tenants” dies their share in the home would pass to the other co-owners without the property having to go through probate. A joint tenancy with survivorship would go as follows: Adam, Beth, and Charlie all own a house together, and Charlie dies. Adam and Beth automatically become the owners of Charlie’s share rather than the share becoming part of Charlie’s estate.
Tenants by Entreaties is when a property is owned by a married couple. This ownership has an automatic survivorship provision as long as they are married at the time of the death of one of the co-owners. Under this ownership, if Adam and Beth owned a home as a married couple, and Adam died, Beth would get his share by survivorship.
Bank Accounts
Survivorship also can apply to joint bank accounts. If there is a survivorship provision on an account and more than one person is named on it, and one person dies, the account will become the property of the remaining account holder. This is an important provision because it allows the account to avoid having to go through probate.
Ultimately, how property is conveyed or accounts are established will determine if there is survivorship. While survivorship is a means to allow property or funds to pass to the other owners without having to go through probate, it is important to carefully evaluate how this provision will affect your estate plan.
Consulting with an attorney who is well versed in this concept and knowledgeable about how it will apply to you, will help you plan for the future. We can help as you understand your choices. Please contact us online or by phone if we may be of assistance.