Vesting Types In South Carolina

As the famous Fleetwood Mac member Don Henley so eloquently put it “Lawyers dwell on the small details”. While that line isn’t the most profound of the lyrics he’d sang, it’s certainly true when those details can effect how you own your property.

For most people, purchase property will be the largest transaction they have made, or will make in their life. With the average South Carolina home value being around $280,000, it’s important that you understand exactly how you, and others on your deed own that property.

In South Carolina we have Fee Simple, Tenants in Common, Joint Tenants with the Rights of Survivorship, and Tenants in Common with Rights of Survivorship. South Carolina does not recognize Tenancy by the Entirety, and this can often confuse people moving from states that do. 

To own property in Fee Simple, simply means that you, as an individual, own the property 100%. However, if you are purchasing property with a spouse, child, partner, sibling, parent, or business partner you will own the property in one of the three subsequent ways. 

Tenants in Common: There will be two “co-tenants” each owning a percentage of the property. This can be in different proportions such as (60%-40%). Upon the death of either of the “co-tenants”, their interest will pass through their estate. This can be through a Will, or through the intestacy laws in Probate if they do not have a will. With this type of ownership an one owner can convey their interest without involvement of the other owner. Additionally, a court can partition this type of ownership, which simply means the court can order the property to be divided, or sold and the proceeds divided.

Tenants in Common with Rights of Survivorship: With TICWROS, there can be more than two owners and as seen above they can own different proportions of the property. The difference between Tenants in Common with Rights of Survivorship and its predecessor is that upon the death of a cotenant the remainder of the property automatically passes to the other owner, as a matter of law. After their passing, a death certificate is recorded at the Register of Deeds. This avoids the need for probate. Additionally, TICWROS cannot be partitioned by a court, unlike its predecessor. This is why it’s often referred to as the “indestructible rights of survivorship”. Most co-tenants prefer this type of vesting because no one co-tenant can convey their interest without the involvement of the other owner. 

Joint Tenants with Rights of Survivorship: With joint tenancy there can be more than one owner. However, unlike TICWROS, the owners must hold equal ownership (50%-50%). While joint tenancy has the benefit of survivorship rights, where the property automatically passes to the surviving owner, it is subject to partition, or creditors of any owner. Additionally, this is not the best way to hold property if you are married because joint tenancy can be severed by Divorce. 

In conclusion, the devil really is in the details. If you have any questions about vesting types or how you want to hold property in South Carolina it is important to discuss this with your closing attorney prior to closing.