A lot of people don’t consider the division of ownership when purchasing property with someone else. They just assume that each party owns an equal share. Or, a share of the property based on the percentage of costs each has paid. But before the Transfer can be finalised, you will need to consider whether you register yourselves as Joint Tenants or Tenants in Common.
Owning as Joint Tenants is more common, and is the usual arrangement in place between married couples or long-term partners who purchase property together. In a Joint Tenants arrangement, the surviving partner takes full and complete ownership of the property if something were to happen to the other.
As Tenants in Common though, each owners share would go to that person’s Estate and then distributed as per the terms of their Will. Each party can have a different size share in the property and can stipulate what is to happen to their share in the event of their death.
If you’ve read this far, I can say with a reasonable degree of confidence that you need to be talking to a Conveyancer now. Even if you’re not ready to engage a Conveyancer yet, contact us and we’ll be happy to share our knowledge on Joint Tenants or Tenants in Common with you.
The next bit to consider is your Will. A Will is a seriously good idea for any adult, and especially adults who own property. But, for Tenants in Common, it’s an absolute MUST, and it needs to be current. You’ll need to update it regularly and most likely you’ll need a Solicitor to handle the paperwork.
Not at all. The two methods can be combined, and under certain circumstances, this makes perfect sense. For example, two couples who purchase property together would do well to consider an arrangement where each couple exists as their own entity with a Tenants in Common arrangement in place between the two couples, however the individuals of the couple may own the property as Joint Tenants.
If something happens to one of the partners in couple 1, the Joint Tenants arrangement means that the remaining partner takes ownership of 100% of their share of the Tenants in Common arrangement. The arrangement between the two Tenants in common (the couples) doesn’t change and the arrangement between both parties of couple 2 won’t change either.
When it comes to Joint Tenants or Tenants in Common, there’s a whole heap more you need to know. Whatever you do, don’t put it off due to its perceived complexity. The complexity involved is what makes it work, and effective, and with the right Conveyancer on board, that complexity itself is no problem at all. You may also wish to discuss the matter further with your Accountant.