When you buy your property with another person, you need to stipulate whether you’re buying as Joint Tenants or Tenants in Common. So, let’s discuss how they differ and which is best for you.
Joint Tenants
- Each of the owners has equal rights to the whole property.
- Up to four owners can be listed under a Joint Tenancy.
- All owners are viewed as a single entity, so if a mortgage is needed, there needs to be one, with all owners’ names on it.
- If one owner decides to sell, all owners must agree to sell together.
- As Joint Tenants, the property is automatically left to the other owners should one die. This is the ‘right of survivorship’ rule. An owner cannot pass on his or her share of the property to others in their Will.
- This type of ownership is usually simpler than Tenants in Common, therefore the costs are sometimes lower.
Tenants in Common
- Each party owns a separate share of the property, and these can differ in size.
- If two friends are buying, one with greater assets than the other, they could split the ownership 60-40, or whatever percentages they want, as long as they add up to 100%.
- If one owner decides to sell, all owners must agree to sell together. This is the same as Joint Tenants.
- Owners can leave their share to someone other than their co-owners in their Will.
- Owners can legally opt to have their own mortgage for their share of the property, but realistically few owners do this. Mortgage lenders prefer to offer joint mortgages.
There are advantages and disadvantages in both options, depending on why you’re buying and who you’re buying with.
Joint Tenancy often suits married couples, while Tenants in Common is frequently chosen by family members or friends investing in property together. Think of two brothers investing in a Buy to Let flat. Should one of them die, they might prefer their half to go to their wife, partner or children, not necessarily the other brother. Or two friends buying a property together to allow both to get onto the housing ladder. One earns more than the other and has been able to put down a larger deposit, therefore the ownership split reflects that larger investment.
Whether you’re looking to buy, sell or mortgage your home, AWB Charlesworth Solicitors Limited has the expertise to guide you through the conveyancing process.
Conveyancing at AWB Charlesworth
Conveyancing – how to get ahead of the game
UK Gov: Conveyancing: solicitor or DIY
For more information, call into our Keighley or Skipton office or contact Furah Basharat on 01535 613675 or furah.basharat@awbclaw.co.uk
19 September 2024
