image of property buyers protecting themselves with a JTWROS agreement

If you’re buying property with someone in New York, you need to protect yourself in unexpected circumstances.

Scenario: You and someone else are buying a co-op, condominium, private home, or even a vacant piece of land together. Perhaps you are life partners — an unmarried couple — and you plan to live there full-time. Or maybe you are siblings or good friends, sharing a place. Or maybe it’s a pied-à-terre that you and a business partner are buying as an investment and considering renting out.

You may both be contributing towards the purchase, or perhaps one of you has the money for the initial deposit and the other can pay more toward the monthly costs. The important fact is that you are not married to one another but you own real estate together. Congratulations! But what happens if one of you dies?

The Importance of JTWROS

Because life is full of strange twists and turns, it would be wise to protect your interests in the event of your death — or your partner’s. And there is an easy, streamlined way to make sure that if you one of you passes on, the other inherits the property. It’s called JTWROS: “joint tenants with rights of survivorship.”

This is a powerful acronym that should be entered on the deed or co-op stock certificate when purchasing property in New York. With it, if one of you dies, the other automatically inherits the apartment, house or land, and no one can contest this. There will be no costly probate or administrative proceeding. No possibility that your partner’s money-grubbing family could contest your ownership. In short, no one can interfere. (And if you buy some inexpensive term life insurance for the amount of the outstanding mortgage, that monkey will also be off your back.)

If you don’t insert this magic phrase on the deed or co-op stock certificate and your life partner dies, you could end up owning the property with your deceased partner’s family. That surely is not what you both intended.

There are other options for titling real estate in New York. You can co-own without survivorship rights, in which case you each handle your partial ownership in your will or estate-planning documents. “Tenants in common” allows you to do this, but it does not afford the automatic protection of JTWROS.

Think about it. One little acronym holds all that impact. Now that’s a lot of bang for your buck.

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