Co-Ownership: One for All, or All for One?
When it comes to property co-ownership, no matter the relationship, there are some legal factors that need to be considered.
Our friend and lawyer Shadi Nasseri is back this week offering her legal counsel on the topic of co-ownership, not so simple as just co-habitation.
Whether it’s your first, a total fixer-upper, or your ultimate dream home, no one can deny the pure rush of joy associated with property ownership. Signing your name on a Title/Deed document is an absolute moment of glory, which is multiplied when shared with the ones you care about most. However, when it comes to property co-ownership – whether the other party is your better-half, your best friend or your colleague – there are some legal factors that need to be taken into consideration. Property owned by more than one person must be owned in one of two ways: ‘Joint Tenancy’ or what is referred to as ‘Tenancy in Common’.
There are important differences between Joint Tenancy and Tenancy in Common to which you should be aware.
Some refer to Joint Tenancy as either the “Last Man Standing” or “A Game of Russian Roulette”. This is because of its most prominent characteristic: when one joint tenant dies, their interest automatically goes to the surviving joint tenant(s). In this way, the title is finally unified with the last survivor. Only that last person can use his or her Will to give the property to someone else. Lawyers call this the “right of survivorship”.
Tenancy in Common, on the other hand, conveys no right of survivorship. In this arrangement, each person owns a half, or third, or some other portion that belongs only to them. When one co-tenant dies, the interest of the defunct co-tenant forms part of his or her estate and can be conveyed to a next-of-kin.
Since these types of co-ownership have different rights and obligations, choosing the wrong type of co-ownership can be a costly mistake. So, when considering ownership with others, make sure you understand the legal implications!
Also read: