If you're thinking of buying a property in partnership with another, you need to be aware of the options available to you. How you proceed may affect how the property is handled during subsequent events and can significantly affect your rights as an individual. In particular, you need to understand the distinction between tenants in common and joint tenants, but how are these defined, and how should you proceed?
While the phraseology may be similar, there is a large difference between these two terms. Joint tenants have equal ownership and interest in any property, and there is a right of survivorship should one die. In this case, the property will automatically pass to the surviving joint tenant, even if there is a contrary indication within the will of the person who passed away.
Tenants in Common
On the other hand, tenants in common have a defined number of shares in jointly owned property. This can be split in any fashion from 50-50 to 90/10 and other variations in between. Each individual can dispose of the shares as they wish at any time. For example, should one pass away, they can dispose of their shares in the will without input from the other party. The surviving party will not be able to claim the balance of shares in this situation, but the arrangement will continue as before.
Joint tenants are often married couples or two people who are in a long-term domestic relationship of some kind. It's not unusual for these people to share vehicles, assets and types of property as part of their relationship. Still, it's not uncommon for other parties to enter this type of relationship from a purely commercial point of view. When you intend to go ahead with a property transaction with a commercial partner, you'll need to decide the legal basis for this arrangement and understand the implications for the future. A standard contract may assume that both parties are "joint" tenants in the absence of any other instruction.
Getting Professional Help
As with any other matter in the real estate world, it's always a good idea to get professional help before you proceed with any contract. Therefore, engage the services of a conveyancer and discuss the difference between tenants in common and joint tenancy arrangements before you proceed. This will help you avoid any expected or unexpected issues as time goes by.
To learn more about conveyancing, reach out to a solicitor that offers that service.Share