How you take title to Florida real estate is one of the smallest decisions on a closing statement and one of the largest decisions in an asset protection plan. In this edition of Trust This, Attorney Joe Seagle answers a question the firm hears constantly from buyers and investors: whose name should actually go on the deed? His starting point for married buyers is straightforward. Absent a specific reason to do otherwise, both spouses should be on title, because Florida recognizes a form of ownership that most states do not — tenancy by the entirety.
Tenancy by the entirety is asset protection built into the deed itself. When a married couple owns Florida property as the entireties, a judgment entered against only one spouse does not attach to that property. If one spouse is sued over a car accident, a contract dispute, or a business claim, and the judgment runs against that spouse alone, the creditor is looking at property it cannot reach. For a Florida business owner or real estate investor carrying real liability exposure, that distinction is the difference between a lawsuit that touches one asset and a lawsuit that touches the family home.
The episode also covers a forgiving feature of Florida law that many property owners never learn about. Deeds routinely fail to recite the buyers’ marital status — the deed simply names two people and says nothing more. If a judgment later attaches to one of those owners, the entireties protection can still apply, provided the owners can sign an affidavit confirming they were married when they took title and remained continuously married for the entire time they held it. The protection turns on the facts of the marriage, not solely on the words printed in the deed. That said, relying on a corrective affidavit after a creditor appears is a far weaker position than getting the deed right at closing.
Entireties ownership is not automatically the right answer in every household. Joe notes that a family law attorney or estate planning attorney may have sound reasons to place one property in one spouse’s name and another property in the other’s, and those reasons are specific to the family, the assets, and the risk involved. He walks through the alternatives as well: sole ownership; joint tenancy with rights of survivorship, where the last surviving owner takes the whole property and which is generally the better fit for co-owners who are not married to one another; and tenancy in common, where each owner’s share passes to that owner’s heirs by will or, absent a will, by statute — one more reason every property owner needs an estate plan. Where unrelated parties own property together, the firm typically recommends holding title in a land trust or an LLC instead, both because management becomes far simpler and because an entity or trust supplies protection that individual ownership never will.
The closing advice applies to every Florida purchase. Before signing anything, talk to a Florida real estate attorney about how title should be held — not a realtor, not a friend, and not, for out-of-state buyers, only the attorney who has handled matters back home. Florida’s rules on entireties, homestead, and creditor protection have nuances that are easy to miss from outside the state, and the cost of correcting a deed after closing is always higher than the cost of preparing it correctly the first time.
Transcript
A lot of people always ask me how they should take title to their real estate. And my advice is always if you’re married, if there’s any other reason to not do so, then don’t do it. But if otherwise, you should take title with both spouses. That’s the best practice because in Florida we recognize tenancy by the entirety. Asset protection. So if one spouse is in an accident or a litigation, a contract dispute, anything like that, where they get sued, and the judgment is solely against that spouse, it will not attach to property that is owned as the entireties, as husband and wife or spouses, a married couple, is generally the way we write that now. They just own title as a married couple. And it will not attach.
Now, the great thing about Florida is, even if the deed into the married couple fails to state their marital status, so it just says, John and Jim take title. If later a judgment hits one of those two people, if they can sign an affidavit saying that they were married at the time they took title. And they remained continuously married the whole time that they held title, then tenancy by the entirety protections will protect that property from judgment creditors. So for that reason, we always recommend holding title as tenancy by the entirety as a married couple if you are a married couple.
Now there are times, of course, that your family law attorney or your estate planning attorney may say, “Well, let’s not do that. Let’s have.” This property in one spouse’s name, this one in the other spouse’s name, and there are very valid reasons at times to do that. So it’s very particular to your situation.
So anytime you’re getting ready to buy property, and you’re going to be taking it in your own name, you’re not going to be taking it into an LLC or a land trust or a corporation. Be sure to consult an attorney to talk about the best way to take title before you. Before you go to closing, don’t just go by whatever your realtor said or whatever a friend told you you should do. Consult a lawyer, a real estate lawyer in Florida who understands Florida’s nuances. If you live outside the state and you’re coming to Florida and you’re buying property, be sure to talk to a Florida lawyer. Don’t necessarily rely just on the advice of your attorney who’s represented you for years in your home state where you’re coming from. So that’s a That’s another thing to think about.
Also, of course, there are other ways to hold title. You can hold it solely in your name. That’s sole ownership. You can hold it as joint tenants with rights of survivorship. Although a married couple cannot hold it as joint tenants with rights of survivorship because they’re married. So it’s always going to be a tenancy by the entirety. Joint tenant right of survivorship just means that the last one standing gets it. So whoever the survivor is of all the owners on the on that property. It’s theirs as long as they are the last survivor after everyone else has died, they own the property. So joint tenants’ right of survivorship is a good way to hold it if you are unrelated by marriage, to hold title that way.
And then also, of course, there’s tenants in common, which means if there’s multiple owners, let’s say there’s three owners, as each one dies, their share goes to their heirs, as they have either put it in their will or by statute, depending on if they don’t have a will or if they have a will. So that’s another reason it’s very important to have a will.
Typically, we recommend if you are unrelated parties owning property together, it’s better to form an entity like a a land trust, form a land trust or form an LLC to hold title to that property, because it just makes management a lot easier, and also protection for asset protection, that I talk about a lot here. It was provided if it’s inside of the trust or an entity. That you’re not going to get if you just own it solely in your names.
So that’s my 10 cents on how to title property, tenants that buy the entirety, joint tenants rights of survivorship, and tenants in common. Hope it helps.
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