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Joint Tenants or Tenants in Common?

By Kevin Kelly

Purchasing a Property as Joint Tenants or Tenants in Common – What it Means?

Many people buy property together, maybe as husband and wife, boyfriend and girlfriend and others buy property together with friends, relatives or partners because financially they have no choice.

Often mortgage repayments and related expenses on an investment property are too much for one person on their income alone so purchasing a property with at least one other person makes a lot of sense.

Despite the reasons for purchasing property with another person, two very important questions must be asked.

  1. What form of ownership will you use to purchase the property; joint tenants or tenants in common?
  2. Do you want to hold an equal share in the property?

If you are purchasing the property as Joint Tenants or as Tenants in Common, there are a number of differences, however, the most significant is if one owner dies, what happens?

Usually in this scenario the share of the deceased owner is passed automatically on to the other joint tenant (s).

Joint Tenant ownership is common where a husband and wife are purchasing a property and usually it is assumed that each person owns 50 per cent of the property.

In a tenants in common situation, each owner may deal with their separate interest as they choose. Through their will, they can pass on their share to anyone; it is not automatically inherited by the other owner.

Whilst joint tenancies are in equal shares, tenants in common do not have to hold an equal share in the property. If they wish to they can or they can split it 60/40, 70/30 or one tenant may own 99 per cent of the property whilst the other tenant in common owns just 1 per cent. The amount each tenant in common owns is determined by the owners themselves.

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