Tenancy by the Entirety

Tenancy by the entirety is a type of concurrent estate in real property that occurs when the owners of the property are married. Each spouse has an equal and undivided interest in the property. In essence, each spouse mutually owns the entire estate. In the event that one spouse dies, the full title of the property automatically passes to the surviving spouse. A tenancy by the entirety permits spouses to jointly own property as a single legal entity.

Understanding Tenancy by the Entirety

Tenancy by the entirety can only occur when the owners are married to each other at the time the title is received. A tenancy by the entirety may be terminated by the death of one spouse, by divorce (resulting in the parties becoming tenants in common) or by the mutual agreement of the spouses.

Tenants by entirety are the spouses who hold mutual ownership of property through tenancy by the entirety. These spouses are referred to as tenants by entirety and have equal rights to ownership of the property.

Example of Tenancy by the Entirety

Each state has its own laws that govern tenancy by the entirety and how it may be applied. About half of all states allow this form of ownership to exist for all types of property held by married couples. Some states only allow tenancy by the entirety to be exercised for real estate that is jointly owned by married couples. The status of ownership of the property will likely be changed during a divorce. The court may order the sale of the property with the proceeds split between the divorcing couple. The court might award full ownership to one party.

Tenancy by the entirety states are Arkansas, Delaware, Florida, Hawaii, Maryland, Massachusetts, Mississippi, Missouri, New Jersey, Oklahoma, Pennsylvania, Tennessee, Vermont, Virginia, and Wyoming.

There are two predominant aspects of tenancy by the entirety that characterize its use in legal action. The married couple shares mutual control and use of the entire property. The property also can only be attached by creditors who the married couple owes joint debts to.

The condition of mutual ownership of the entire property means the spouses must be in agreement when making decisions about the property. One spouse could not sell off or develop part of or the entire property without their spouse’s consent. There is no subdivision that separates the property into equal parts between the spouses. If one spouse writes a will that would grant an interest stake in the property to an heir, the power and rights of tenancy by the entirety would invalidate and supersede that aspect of the will. 

Special Considerations

Creditors who seek relief on delinquent debt cannot enter claims against property that is under tenancy by the entirety unless the couple shares in that debt. For example, if a borrower owes delinquent payments on a motorcycle they acquired only for themselves, the lender could not put a lien against a house the borrower owns with a spouse because the property is under tenancy by the entirety.