Joint Tenants With Rights of Survivorship

What Does JTWROS Mean?

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If you've ever bought property with someone else or you're about to, you may have encountered a number of confusing terms relating to how you'll hold title. These terms convey some serious legal implications so it pays to know what you're getting into before you sign on the dotted line of that deed. One of these terms is "JTWROS." 

What Is a JTWROS? 

JWTROS stands for "joint tenancy with rights of survivorship." Let's start with the "joint tenants" part.

Joint tenants are two or more people who own property together. Four requirements or "unities" must be present to allow them to hold title this way:

  • Unity of time: They must all take possession of the property concurrently, at the same time.
  • Unity of title: They must all take title by the same "instrument." An instrument is any document that can transfer property, such as a deed or a will. 
  • Unity of interest: Each tenant or owner has an equal interest in the property. For example, three tenants would each have a one-third ownership share. This is the case even if one of them paid for the entire property — he would not have an additional ownership stake. 
  • Unity of possession: Each tenant has a right to possess and enjoy the entire property even though he only has a partial ownership interest.

Joint tenants are entitled to sell or transfer their shares to third parties without the approval or consent of the others.

If Tenant A transfers or sells his interest to "Joe," the joint tenancy in place between Tenants B and C would remain in place. But because of the unity of time and unity of title requirements, Joe would not become a joint tenant with them — he did not take title at the same time or with the same instrument.

Joe would therefore become a tenant-in-common with Tenants B and C. 

What Is Survivorship? 

The survivorship provision of a JTWROS allows the other owners to automatically and immediately inherit another tenant's share in the event of his death. The property passes outside probate rather than to the deceased owner's heirs-at-law or under the terms of his last will and testament or revocable living trust. In fact, his interest in the property cannot be conveyed to any other beneficiary by will or trust — it belongs to his co-tenants by operation of law.

If Tenant A dies, Tenants B and C would now each hold a 50-percent interest in the property rather than a one-third interest. Because the transfer does not require probate, Tenant A's creditors would have no entitlement to his share and it would not be included in his estate to pay his final bills. 

This type of ownership can also be used with bank and investment accounts, as well as stocks, bonds and business interests. It's not usually the default form of ownership when an asset is held by two or more people. They would typically hold title as tenants in common. 

Contrast a joint tenancy to "Tenants by the Entirety" and "Tenants in Common."