HOW TO HOLD TITLE TO REAL ESTATEHolding Title to Real Estate in Florida

The grantee in a deed of land must generally be a person, natural or artificial, in existence at the time of the conveyance, and
legally capable of accepting the deed and holding title to real property. An individual generally must be at least 18 years of age and mentally competent or not under a mental disability to hold title to real property in Florida. An individual is not required to be a resident of the United States to hold title in Florida; however, the conveyance of real property by non-citizens generally may create certain non-Florida specific issues, specifically with respect to taxation.

Further, Florida law provides significant protections for homestead properties related to certain liens of creditors, devise and descent of the homestead property, and transfers or encumbrances by spouses without the joinder of the other spouse.

A domestic business entity may generally acquire, hold title to, and convey real property in Florida if authorized, current, and in accordance with its applicable governing documents, as more specifically set forth within the applicable provisions of Chapters 607 (corporations), 608 (limited liability companies), 617 (corporations not for profit), and 620 (partnerships), Florida Statutes. Each of the respective entities provides certain liability shields that would impact liabilities arising from the ownership of real property. Similarly, a foreign business entity may generally acquire, hold title to, and convey real property in Florida if authorized, current, and in accordance with its applicable governing documents. In addition, a foreign business entity generally does not need to be registered in Florida to merely hold title or enforce rights in real property.

Generally, there are four variations as to how title may be held in Florida. Below is a brief summary referencing the more common examples.

Sole Ownership

This is the simplest form of ownership. For example, a man or woman may take title in their own name. In such instances there is no creditor protection.

Tenancy in Common

In a tenancy in common, each cotenant owns an undivided interest and possessory right in and to the real property. Possession is the only unity necessary for a tenancy in common. Each cotenant has a separate estate that is freely alienable, can be attached by creditors, is descendible to heirs, and is devisable by will. Unless otherwise agreed to by the cotenants, each cotenant is generally liable for its proportionate share of the obligations arising from ownership of the real property, even if only one cotenant is in possession of the property. A cotenant in possession of the property may generally seek contribution from the other cotenants regarding payment of the proportionate expenses. Unless otherwise agreed to by the cotenants, all rents and profits received concerning the real property are generally to be proportionately shared by all cotenants. Any cotenant may file an action to partition the cotenants common interest in the real property.

A. No Right of Survivorship. There is no right of survivorship between tenants. Thus, each tenant in common can make a testamentary transfer of his interest; if a tenant in common dies, his interest will pass under the intestacy statutes or by will to his heirs.

B. Unequal Shares. Tenants in common may have unequal shares.

C. Presumption in Florida. Under Florida law, except in the case of a tenancy by the entireties (discussed below), a conveyance to two or more persons creates a tenancy in common unless the instrument creating the estate expressly provides for the right of survivorship.

D. No Creditor Protection. If the property owned is non-homestead in character, then creditors of one co-tenant can levy on that co-tenant's undivided interest to satisfy the debt owed to the creditor.

Joint Tenancy with Rights of Survivorship

Under Florida law, except in the case of a tenancy by the entireties (discussed below), the instrument of conveyance must provide for rights of survivorship for a joint tenancy to be created. Otherwise, the tenants will be tenants in common. Each joint tenant owns an undivided interest and possessory right in and to the real property. The unities required for creation of a joint tenancy in Florida are (a) unity of time; (b) unity of title; (c) unity of possession; and (d) unity of interest. In the event of death of a joint tenant, the real property passes by operation of law to the surviving joint tenant. Each joint tenant has a separate estate that is freely alienable and attachable by creditors. A joint tenant may mortgage its interest in the real property. A joint tenancy is converted to a tenancy in common when a joint tenant conveys its undivided interest in the property to another person. Any joint tenant may file an action to partition such joint tenants interest in the real property.

A. Survivorship. Each joint tenant has a right of survivorship. That is, if there are two joint tenants, and one died, the other becomes sole owner of the interest that the two of them had previously held jointly.

B. Possession. Each joint tenant is entitled to occupy the entire premises, subject only to the same right of occupancy of the other tenant(s).

C. Equal Shares. Since the joint tenants have identical interest, they must have equal shares. Thus, one joint tenant cannot have a one fourth interest, say, with the other having three-forth interest.

Tenancy by the Entirety

Only a married couple may own real property as tenants by the entireties. A conveyance of real property to a married couple is presumed to create a tenancy by the entireties. A tenancy by the entireties is a joint tenancy with a fifth unity, the marriage of the parties. Unlike a joint tenancy, a tenancy by entireties includes a right of survivorship regardless of whether the conveying instrument establishes such right, i.e., as long as the five unities are present, there is a right of survivorship. Unlike a joint tenancy, a tenancy by the entireties may not be terminated by one spouse without the other spouse's consent. In addition, neither spouse can sell, mortgage, or encumber the real property without the other spouse's consent. Creditors generally cannot attach property held in tenancy by the entireties unless such creditors are joint creditors of both spouses. A tenancy by the entireties automatically terminates and becomes a tenancy in common upon dissolution of the marriage.

A. No Severance. A key feature of the tenancy by the entirety is that it is not subject to severance. So long as both parties are alive, and remain husband-and-wife, neither one can break the tenancy. No conveyance will be good without joinder of both spouses.

B. Survivorship. Most significantly, each spouse knows if he or she survives the other, the survivor will get a complete interest.

C. Protection Against Creditors. The entirety estate cannot be pierced by creditors of one spouse alone. For a creditor to levy upon entireties property to satisfy debt, the creditor must be a creditor of both the husband and wife.

D. Divorce. If the parties get divorced, the tenancy by the entirety fiction ends. The parties are then treated as owning separate "undivided" interests (usually as tenants in common).

Spousal Rights in Real EstateHolding Title to Real Estate in Florida

In Florida, a conveyance of real property to persons who are married is deemed to create a tenancy by the entireties, unless a contrary intention is clearly shown in the deed of conveyance. This is true whether or not the persons are stated to be married in the deed itself. Spouses may elect to own property as tenants in common, if they wish to do so, and if the intention is clearly stated in the deed of conveyance. An individual who owns real property may subsequently create a tenancy by the entireties in that property with his/her spouse. The creation of an estate by the entireties can be accomplished by conveyance to one spouse, with a statement in the deed that the transaction is intended to create a tenancy by the entireties, or by a conveyance to both spouses. If the property is subject to a mortgage, consent of the mortgagee may be required for such a conveyance. In addition, such a conveyance may trigger documentary stamp tax consequences. Interspousal conveyances of property, including homestead property, no longer require spousal joinder. For instance, one spouse may convey to the other his/her interest in property, whether or not homestead, without joinder of the transferee spouse. An individual who owns real property at the time of marriage continues to own that property, subject only to homestead rights of his/her new spouse, if the property constitutes homestead property. If the property is not homestead property, the spouse does not acquire an interest in the real estate by virtue of a subsequent marriage, and the new spouse is not required to join in any mortgage or conveyance. For so long as an interest in real property is vested in husband and wife as tenants by the entireties, a judgment against one spouse will not attach to the property. If property is owned as tenants by the entireties, neither spouse, acting alone, may convey any interest in the property or mortgage or otherwise encumber the property. Any conveyance or mortgage of property owned by the entireties should be by means of one instrument executed by both spouses. It is possible that separate deeds or mortgages, each executed by one spouse, could be collectively construed as one instrument of conveyance or mortgaging, but such construction might require judicial intervention.

Upon dissolution of a marriage, persons who formerly owned property as tenants by the entireties shall thereafter be deemed to own the property as tenants in common, as of the time the judgment of dissolution becomes final, unless the judgment dissolving the marriage specifically provides otherwise. If property is owned as tenants by the entireties, upon the death of one spouse, title automatically vests in the surviving spouse, so long as the spouses remained continuously married during their ownership of the property. This is true whether or not the property was homestead property. Although it is sometimes requested or required, by a title insurance company or other party, that an affidavit of continuous marriage be recorded, it is presumed, in the absence of evidence to the contrary, that a marriage is continuous from the date of its inception.

If record title to homestead property is vested in one married person, the spouse must join in any mortgage, encumbrance, or conveyance of that property. However, in the absence of spousal joinder, Florida courts may nonetheless impose a constructive trust or equitable lien on the property in favor of a creditor where the mortgage is obtained by fraud and the subject funds are used to acquire or improve homestead property. If record title to homestead property is vested in one married person, upon the death of that person, title vests in the surviving spouse if there are no lineal descendants. If there are lineal descendants, the surviving spouse takes a life estate, and a vested remainder vests in the lineal descendants. For surviving spouses who cannot afford / are not willing to assume the burdens associated with a life estate, Florida law allows the spouse to forgo his/her rights to a life estate and instead take an undivided one-half in interest in the property, with the other half passing to any lineal descendants, per stirpes. Such election is irrevocable once made.