Many New Jersey families have worked very hard to purchase their primary residence, and some are also fortunate enough to have vacation property. When creating an estate plan, it is important to understand how real estate is handled. Making the best possible choices can aid in wealth preservation and can ensure that property is passed down in the manner that is intended.
One thing to consider when working out an estate plan is the type of tenancy used within the will. For those who want to divide the value of their home equally among two individuals, joint tenancy is an option. In joint tenancy, each party owns an equal share of a property. If one of the parties dies, the other inherits their share, making the surviving party the full owner. This is an attractive option for couples who wish to pass down a piece of property to the surviving spouse.
It is also possible to create a system of common tenancy, in which a property is owned in varying parts. Those parts do not have to be equal, and ownership can be granted at various times and for varying reasons. When one party dies, the share in the property passes through his or her estate. Through a last will and testament, the share can be passed down as desired, say to children and grandchildren.
The difference between joint and common tenancy is just one example of the flexibility that New Jersey residents have in regard to estate planning and wealth preservation. When a family is planning to hand down real estate, it makes sense to review all of the available options. An estate planning attorney can help guide individuals or families toward a plan that meets their needs and goals.
Source: realtor.com, “Real Estate and Your Estate Plan: How Does It Work?“, Deborah Kearns, Oct. 29, 2015