Tenants in Common & Homestead Exemption

by Erika Johansen

Homestead declarations are designed to protect property in the event of a family death. The exemption allows the dead individual's spouse and children to retain the right to live in the house, or receive part of the value of the house, despite the claims of the dead individual's creditors. Surviving tenants in common generally have the right to the homestead exemption, but the exemption may operate differently in tenancy cases.

Homestead Laws

Homestead laws were originally created in order to protect a family home or farm for the use of a deceased individual's surviving spouse and children. Prior to these laws, the deceased's creditors could theoretically sell off the family house in order to satisfy the deceased's debts. The deceased could also will away the property from his spouse and children. Homestead laws, by contrast, gave the surviving spouse the right to occupy the homestead for his or her lifetime.

Homestead Exemption

In the U.S., homestead laws have evolved into the modern homestead exemption, which varies widely by state. Some states' laws still protect the entire homestead, while other states now only reserve a limited portion of the value of the homestead for the spouse and children, and allow creditors to take the rest of the property. Some states have an automatic homestead exemption upon the death of the owner, while other states allow probate courts to set up the exemption, and a third group requires the owner to create the homestead exemption during his lifetime. In some states, the applicability of the exemption may also depend upon the size of the homestead property.

Tenancy in Common

Tenancy in common is a very specific property ownership arrangement in which two or more co-owners each own fractions of the piece of property. However, each owner has the power to use the whole of the property, so long as that use doesn't preclude other owners from also using the property as they wish. If tenants in common wish to divide the property completely and become sole owners of their own portions, they can do so via a legal action known as "partition."

Tenant Homestead Exemptions

The right of tenants in common to enforce a homestead exemption is determined by state law. States typically allow tenants in common to enforce the homestead exemption, but hold the homestead rights subordinate to each tenant's right to seek partition of the property. Some states demand that each individual tenant file his own homestead request, particularly if the tenants in common are not married to each other. In states that award a portion of the homestead's value to the survivor, each tenant is usually entitled to an amount equal to his fraction of the value of the property.


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