Denver Real Estate Law and Family Law Blog. (Vol 1.30) March 11, 2014 

By Craig Franklin Chambers Esq. 7851 S. Elati Street #204, Littleton,  CO 80120

The Littleton Lawyer.

As a Littleton lawyer who specializes in civil ligation, real estate law and divorce and family law in Denver, Littleton,  Centennial, Englewood, Lakewood, Highlands Ranch, and Unincorporated South Jeffco, the question arises: how to take title to real estate and what is "Joint Tenancy"?

I run into this question in my law practice which includes drafting or reviewing deeds and purchase contracts for buyers and sellers and FSBOs as well as negotiating real estate property settlements in the context of a divorce or dissolution of marriage.

Joint tenancy is a term designating how two people who own a home together take title. When you purchase a home with another person, you can choose to be "joint tenants" or "tenants in common". This is a designation that is expressly stated on the deed, whether it be a quitclaim deed or a general warranty deed. The deed is then recorded with the Clerk and Recorder of the county where the real property is located.

Joint tenancy means that you owe the property with the other person as a co-owner with the right of survivorship.  Each party owns 100% of an undivided interest in the property.  If one party dies, the deceased person's interest disappears, and the entire property automatically becomes the co-owner's property. This is almost always the preferred method of taking title when the co-owners are a couple, otherwise related or the parties wish for their co-owner to inherit the property.

If the quitclaim or warranty deed  doesn't specify how the title is to be taken, or if the parties so choose, the property can be taken as tenants in common. This is a designation  usually preferred by co-investors, business partners or people who wish their own heirs and not the co-owner to inherit their interest if  co-owner dies. This is the default method of taking title in Colorado.

Title as tenants-in-common means that you and the co-owner own the property  jointly,  without the right of survivorship. Unlike joint tenants, the owners can divide their interest among themselves in whatever percentages the parties have agreed.  The ownership could be fifty/fifty or seventy/thirty or whatever the transaction involves. If one party who has an interest in the property dies, his interest in the property goes to his heirs and not to his co-owners in the property.

Title issues are usually determined when the purchase contract is written. Sometimes the lenders have requirements as to how title is taken, depending on which parties are qualifying on the loan for the property. Title can be changed, as people's requirements change, by the simple transfer of the property by a quitclaim deed. The important thing is to understand the tax advantages and disadvantages and estate planning consequences of how title is taken before agreeing on how title is to be designated.