MANY properties are owned by more than one individual or entity and this often is referred to as ‘‘joint ownership’’. There are two very distinct types of joint ownership – joint tenancy and tenancy in common.
Joint tenants own property in equal shares, depending on the number of owners. For example, if there are two joint owners, each owns half the property. If there are six joint owners, each would own onesixth.
When a property owned by joint tenants is sold, each joint tenant (or owner) has an equal interest in that sale and each is required individually to sign the sale contract.
Should a joint tenant die, their interest in the property automatically passes to the surviving owner(s).
Tenants in common may own property in unequal shares and t his t ype of ownership is usually established at the time of purchase.
The specific shares can be altered at any time, subject to all parties agreeing on the change.
This type of ownership often is used with investment properties and each tenant in common is able to deal with their interest individually.
This means they are able to leave their portion of ownership in their will to anyone they choose and the other tenants in common have no legal claim to it.
When buying a property, make sure you consider the type of ownership you wish to establish.
If you do not specifically stipulate a request for tenants in common on a transfer of title, then joint tenancy will prevail.