Q: I am trying to decide how to take title to our new house. My wife is in the medical profession and could be sued. One of our choices is joint tenancy with rights of survivorship. What do you think?

A: I’d like you to consider another way of owning this property that might provide better creditor protections: tenancy by the entirety.

Tenancy by the entirety means that each owner owns the whole property. So, you don’t own half, you both own the whole house. The key difference between joint tenancy and tenancy by the entirety is this: if you own property as tenants by the entirety, both spouses must agree before the property becomes subject to one spouse’s creditors.

Neither spouse can do anything that would create a claim or lien on the marital property. So, as long as you and your spouse stay married, and you own the property, tenancy by the entirety protects each of your interests. That provides better protection against creditors.

For example, let’s say your wife gets sued for malpractice. If the plaintiff wins, the creditors could not force the sale of your house because each of you owns the entire property. The creditors would have to wait until you divorced or the property is sold. Once the property is sold, the creditors could stake a claim to your spouse’s share of the proceeds.

Tenancy by the entirety isn’t available in all states. For more details on whether this is an option for you and how to retitle your property as tenants of the entirety, please discuss the issue with a real estate attorney.

Published: Jul 29, 2008