In Utah, an owner can hold title to real estate in several different forms. Three forms of ownership are discussed below: 1) sole ownership; 2) joint tenancy with rights of survivorship; and 3) tenancy in common.
The simplest form of ownership in Utah is sole ownership by a single individual or entity. That individual or entity can sell, transfer, use, enjoy, and burden the property however it wants. No other owners have rights or a say in how the property is used.
Joint Tenancy with Rights of Survivorship
In Utah, joint tenants are two or more property owners who have equal and identical ownership shares and ownership rights to a parcel of real property. They enjoy the right to free and unobstructed possession and enjoyment of the jointly held property.
However, one joint tenant cannot bind a co-owner by a contract relating to the common property. For instance, one joint tenant cannot sell the entire property without the approval and signature of the other joint tenants. A joint tenant could only sell his or her interest in the property, which would terminate the joint tenancy and create a tenancy in common (discussed next) between the new owner and all the old owners. A joint tenancy also terminates when a joint tenant mortgages its interest to a third party. A joint tenant can also destroy a joint tenancy and create a tenancy in common by executing and recording a deed transferring its interest to itself.
Each joint tenant has what is called a “right of survivorship,” which means that when a joint tenant dies, that owner’s rights in the property automatically transfer in equal parts to the remaining owners. So, if there are three joint tenants, they all have a one-third, equal interest in the property. If one dies, the remaining tenants then have an equal one-half interest in the property. When only one tenant remains alive, that tenant becomes the sole owner of the property. So, all that a joint tenant must do to obtain full title to a property is outlive the other joint tenants. Because of this right to survivorship, whether there is a joint tenancy or a tenancy in common, when a co-owner dies is very important. If a tenancy in common exists, the remaining tenants do not inherit the property through the right of survivorship, but they do under a joint tenancy.
Tenancy in Common
Tenants in common, like joint tenants, are co-owners who have the right to use and occupy the entire property. However, different from joint tenants, tenants in common can hold different ownership shares in the real property. For example, one tenant in common may hold a 25% interest in a property while the other holds the remaining 75% interest.
Another huge difference between a joint tenancy and a tenancy in common is that tenants in common don’t enjoy rights of survivorship. When a tenant in common dies, that owner’s interest in the property passes to that owner’s heir. It does not pass automatically to the other co-owners as is the case with a joint tenancy, which includes rights of survivorship.
But similar to a joint tenants, one tenant in common cannot bind other tenants in common to a contract (such as a sale) without approval from the other tenants in common, although one tenant in common can generally sell or transfer whatever interest that tenant in common possesses without approval from other owners.
Help with Real Estate Issues
This article discusses only briefly some forms in which people and entities can hold title to real property. It does not by any means discuss many of the nuances of these types of ownership. If you have questions or concerns about real estate ownership, I am happy to help. I offer a free consultation. My direct dial is 801-365-1021, and you can e-mail me at email@example.com.