If you are considering acquiring real estate with a spouse, family member, business partner, or any other individual, you will be required to specify how title will be taken to that property. In Wisconsin, there are three ways to take title to real estate: as tenants in common, through joint tenancy, or through marital property. Each method of taking title is different and can significantly affect property rights, such as who pays for loans on the property, maintenance costs, how each owner can use or dispose of their share, and what happens to the property upon an owner’s death. Below is a brief discussion of each method:

1. Tenants in Common

Taking title to real estate as tenants in common is sometimes a deliberate choice or can be the default when no other method is specified. In a tenancy in common, two or more people can share ownership rights to real property with each owner having a right to use and possess the entire parcel, regardless of the fractional share each owner paid. So, for example, if A pays $40K and B pays $60K for the property, this does not mean that B gets to divide the property up consistent with his 60% share and exclude A from it. Rather, both A and B must share the entire property.
The 50/50 rule applies to most aspects of a tenancy in common. For example, owners are equally responsible for maintenance costs and taxes. Only one property tax bill will be issued for the parcel, thus it is the responsibility of the parties to divide costs up as they see fit. The most efficient way to do this is through a tenancy in common agreement. Further, each owner is said to own his or her interest “severally”, meaning that he or she is free to sell or dispose of his or her interest, and no consent of the other co-owner is necessary to do so. It is easy to see some of the pros and cons of a tenancy in common, compiled below:

Pros of a tenancy in common:

• Allows individuals to pool their resources so that they can afford property,

• Each party can own different sections of the property if specified by a tenancy in common agreement, and

• Property taxes and other expenses are split between all owners

Cons of a tenancy in common:

• There are no survivorship rights in a tenancy in common, which means that when one owner dies, his/her share does not pass to the other owner, but rather to the decedent’s estate,

• Each owner must share the entire parcel with the other owner, unless the parties agree otherwise, and

• Owners may end up with unanticipated co-owners as a result of each owner’s right to freely transfer or sell their interest or when one owner passes away.

2. Joint tenancy

A joint tenancy, like a tenancy in common, allows two or more people or entities to share a property equally. However, unlike a tenancy in common, joint tenants have survivorship rights, meaning that if one owner dies, his or her share passes to the remaining owner or owners.
Joint tenants, like tenants in common, must share the entire parcel with the other owners. There is still the option of drafting a joint tenancy agreement to fractionally divide each owner’s share. However, there are some unexpected nuances here. For example, if joint tenants agreed to fractionally divide the parcel and one joint tenant decides to lease his or her share, most would presume that the owner offering the lease gets to keep all proceeds from the lease. However, this is incorrect – the typical presumption is that the lease proceeds must be split 50/50 or equally with the other owners.

Pros of a joint tenancy:

• Survivorship rights when one owner dies; his or her interest passes to the remaining owner(s), thus affording the opportunity to become a sole owner,

• Each owner can own specified sections of the property if specified by a joint tenancy agreement, and

• Property taxes and other expenses are split between all owners

Cons of a joint tenancy:

• Each owner must share the parcel with the other owners, unless the parties agree otherwise, and

• Equal rights and responsibilities of all owners mean that if one owner takes a loan out against the property, all co-owners may responsible.

3. Marital property

Wisconsin, being a marital property state views all property as owned by the marriage, not each individual in it. Thus, each spouse automatically owns a ½ share of all property acquired in the marriage, unless a marital property agreement specifies otherwise. For Wisconsin transplants who have acquired property out-of-state before moving to Wisconsin, property is recognized as quasi-community property, which is complex and helps courts determine how to divide property upon divorce or death.
Marital property, like property taken in joint tenancy, has survivorship rights. In the marital context, this means that if one spouses dies, the surviving spouse receives the deceased spouse’s half of the property. A common example is a home held in title as marital property. If both spouses are on the deed to the home, then the entire home goes to the surviving spouse. Depending on each couple’s situation, this may be either a pro or a con. Some of these pros and cons are outlined below:

Pros of marital property:

• Survivorship rights: If one spouse dies, his or her share goes to the surviving spouse

Cons of marital property:

• Frustrated interests: If one spouse wants to sell, but the other does not, it can cause a gridlock on being able to sell the property. Both spouses need to agree to sell.

• Even if one spouse was the one to acquire the property at first, the other spouse may acquire a ½ share if the property is used as a primary residence or marital funds are used to pay or upkeep the property. This can be a con in the context of divorce or estate planning.


Now that you understand the three ways co-owners can take title to property and the cons that may arise when co-owners interest become frustrated, you may be wondering what solutions are available when co-owners cannot come to an agreement.

One option is asking the court to petition the property, which will be discussed in our upcoming blog post. Stay tuned and read on!

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