Illinois is one of several states that permits real property to be held in tenancy by the entirety. Tenancy by the entirety is similar to joint tenancy, but with the added element of marriage and that the real property must be maintained or intended for maintenance as a homestead by both spouses together. Spouses must obtain the ownership interest at the same time, through the same title, with equal ownership interest, with equal rights to possess the whole of the property, and the property must be maintained as a homestead by both spouses. It is important to note that Illinois permits parties to a civil union to hold property as tenants by the entirety.
Like joint tenancy, holding property as tenants by the entirety permits a right of survivorship (i.e., property passes to the surviving spouse when one spouse dies). Unlike joint tenancy, one spouse cannot sever the tenancy by the entirety unilaterally by transferring his or her interest to the property. Property held in tenancy by the entirety protects the homestead property from creditors of only one spouse. A creditor can’t attach a lien and foreclose on a property held in tenancy by the entirety, if the debt is only owed by one of the two spouses, whereas a creditor can attach a lien and foreclose on a property held in joint tenancy. For example, if one spouse owes a debt for a credit card held in his name only, the credit card company cannot attach a lien or foreclose on property owned by both spouses as tenants by the entirety.
If property is held in tenancy by the entirety and the spouses divorce, the ownership interest will become a tenancy in common as a matter of law. If the spouses decide to elect to maintain another property together as a homestead (e.g., move to a new home and maintain ownership of the old property), the tenancy by the entirety becomes a joint tenancy. Additionally, both spouses must execute any deed, contract for deed, mortgage, or lease of homestead property held in tenancy by the entirety for it to be effective.
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