Before you purchase real estate in Illinois, it’s important to consider how you will hold title. The form of ownership you choose impacts everything from how your property passes after death to how it’s protected from creditors.
In Illinois, the three most common ways to hold title are:
Tenants in Common
When property is held as tenants in common, each owner has an undivided fractional interest in the entire property. All co-owners have the right to use the full property, regardless of the size of their ownership share.
However, if one owner passes away, their share does not automatically go to the other owners. Instead, it passes to their heirs or according to their will – this often leads to complicated estate situations.
Why this matters:
Tenancy in common is often used when co-owners are business partners, siblings, or friends who want their share to pass to their families, not the other owners. However, it’s not ideal for most married couples.
Here’s why: under Illinois law, if a married person dies holding property as a tenant in common, part of their share may go to their children, not just their spouse. This means:
- Adult children may need to sign off on a sale.
- If a child has passed but has children of their own, grandchildren may also need to be involved.
- Disagreements or delays can lead to deadlock or legal disputes.
🔎 Important: If a deed does not specify how title is held, Illinois law assumes tenancy in common by default.
Joint Tenancy
In a joint tenancy, all owners also hold equal, undivided rights to the entire property, but with one major difference: the right of survivorship.
This means that when one owner dies, their share automatically passes to the surviving owner(s), outside of probate.
Pros:
- Avoids probate
- Simple for co-owners who want survivorship rights
Cons:
- A creditor of one joint tenant can place a lien on the property
- Each joint tenant can sell or encumber their share without the consent of the others
Joint tenancy is a solid option for those who want simplicity and survivorship, but it doesn’t offer creditor protection or flexibility for inheritance planning.
Tenancy by the Entirety
Tenancy by the entirety is a special form of ownership available only to married couples and only for their primary residence.
It functions like joint tenancy with right of survivorship, but with extra protection from creditors.
Key Benefits:
- If one spouse is sued or owes a debt individually, the property generally cannot be touched by that creditor
- Only joint creditors (those to whom both spouses owe a debt) can pursue the property
- Provides right of survivorship to the surviving spouse
This form of ownership is often the best choice for married couples in Illinois who are buying or refinancing their home and want both survivorship and added asset protection.
Which Option Is Right for You?
The way you hold title can have long-term implications – especially when it comes to estate planning, selling property, or dealing with debt.
💬 Talk to an expert before you close. Call Andrew or Alex at (217) 428-8080 to discuss the best way to hold title based on your situation.