Tenant in Severalty

[larue]

Hi. I am in the process of closing on a second week at Ko Olina and received closing documents indicating that title is held by __________________, husband of _________________, as Tenant in Severalty (note I kept out the names for privacy).

My concern is that his form of ownership seems to imply that the wife also has an interest of some kind in the property and yet our deal is with the husband. I looked up Tenant in Severalty and it seems to define it as whole ownership, but I am worried about the reference to a third party (the wife) who is not signing off on the deal.

Any thoughts or guidance would be appreciated. Could it have something to do with a community property state? The seller is from Indiana and indicated "divorced" on the initial paperwork.

 

[BocaBum99]

You are fine. Tenants in severalty means "sole" ownership. It only belongs to him even though he is married.

If it was held, "Tenants by the entireties," then it would be held by the married couple as if they were one person. In other words, to the marriage.

 

[larue]

Thank you! I always appreciate your posts.

 

[Purefct]

I'm sure everything worked out fine, however there are a few particulars which could provide a problem.

It sounds like the seller is granting the timeshare on the deed as a husband owning separate. This conflicts with paperwork you mention that the seller is divorced. In a case like this it is very important to review the deed history because I wonder if a step has been left out.

For example, what if the husband and wife bought the timeshare together? A deed would need to be prepared during/after the divorce where the wife granted her portion of the timeshare to the ex husband, then he would deed to you as a single man.

In non community property states it's relatively simple for a spouse to own separate property. However, during a divorce property is divided according to equitable distribution principals. While it is most likely the husband bought the timeshare in his name only and during divorce he ended up with it, you don't know this for certain.

In either case, reviewing the prior deed is very important to ensure the action the husband is taking will not cause a problem for you. Especially if he's divorced, there could be a divorce agreement where the spouse has ownership. There could also be an unrecorded deed between the two spouses.

Your purchase is probably fine. But when you sell the timeshare in the future you don't want issues to come up. If the husband had the right to sell the timeshare to you but the deed was to he and his wife and no deed was recorded showing she gave up her interest, someone might notice this. Your closing company should have ensured there was not any issues with ownership but they do not always do the job correctly.

 

[DanCali]

Your closing company should have ensured there was not any issues with ownership but they do not always do the job correctly.

The only way to truly guarantee that there are no issues with the ownership is to get title insurance.

For an expensive Marriott timeshare, especially if I had concerns as the OP does, I wouldn't hesitate forking over the extra $300 or so just to get the peace of mind.

 

[Purefct]

While I'm not likely to pay the title insurance fee, I agree completely that title insurance is an excelent method to add safety to your new ownership. Most closing companies I've seen offering title insurance tend to offer it for more than $300 though, and the base closing fee is usually higher than the $250-$450 usually charged for closing a timeshare. I opt to read the seller deeds now (both where seller is grantee and then grantor), ask for the estoppels, other verification info, rather than spend the additional money. But for most people the title insurance is a good way to go if they have any concerns.

 

[Fredm]

Title insurance (unpadded) should cost $200-220 for a Hawaii Marriott purchased under $40,000.