North Carolina General Statutes 41-60. Liability of entireties property for debts of spouses
(a) With respect to property held by spouses as tenants by the entirety prior to its termination, all of the following shall apply:
(1) The property may not be held liable for individual debts of either spouse and a judgment lien against one spouse alone does not attach to the property. The property may be conveyed by joint deed of both spouses to anyone of their choice free and clear of a judgment lien against either spouse.
(2) The property is liable for obligations of both spouses and a judgment lien against both spouses upon a joint obligation attaches to the property which may be sold under execution to satisfy the judgment.
(b) Upon termination of the tenancy by the entirety and the conversion of the real property held by the entirety to another form of estate, a judgment lien against one spouse during tenancy by the entirety, if still active and unsatisfied, shall attach at that time to that spouse’s interest in the new estate. Conversions of tenancy by the entirety property to another form of an estate occur, without limitation, under either of the following circumstances:
(1) Upon divorce of the spouses, in which event the property is converted to a tenancy in common as provided in N.C. Gen. Stat. § 41-63(5) and the judgment lien against the spouse will attach at that time to the undivided interest of the spouse.
(2) Upon death of a spouse, in which event the surviving spouse acquires the entire legal title as provided in N.C. Gen. Stat. § 41-64 and the judgment lien against the surviving spouse will attach at that time to the property. ?(2020-50, s. 1(a), (c).)
Terms Used In North Carolina General Statutes 41-60
- Deed: The legal instrument used to transfer title in real property from one person to another.
- following: when used by way of reference to any section of a statute, shall be construed to mean the section next preceding or next following that in which such reference is made; unless when some other section is expressly designated in such reference. See North Carolina General Statutes 12-3
- Lien: A claim against real or personal property in satisfaction of a debt.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- property: shall include all property, both real and personal. See North Carolina General Statutes 12-3
- Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
- Tenancy by the entirety: A type of joint tenancy between husband and wife that is recognized in some States. Neither party can sever the joint tenancy relationship; when a spouse dies, the survivor acquires full title to the property.
- Tenancy in common: A type of property ownership in which two or more individuals have an undivided interest in property. At the death of one tenant in common, his (her) fractional percentage of ownership in the property passes to the decedent