Your options for Joint Ownership of Property

This guide will help you understand all the things you need to consider and what options are available to you when you buy a property with someone else.

Buying a property with someone else is exciting but careful consideration needs to be given to what might happen in the future. It’s important to agree as a couple what will happen if you separate, and you also need to consider what you would want to happen to your house should one of you die. These discussions are essential and should happen BEFORE you commit to buying a property.

The two main options are:

Joint tenants:

This means that if one of the joint owners dies, his or her share of the property automatically passes to the surviving owner(s). This applies even if the individual has made a will which states that the property will pass to someone else.

Please note that either party can sever the joint tenancy at any time without necessarily advising the other that they are doing so. Bankruptcy of either party will automatically sever the joint tenancy. If the joint tenancy is severed then you will hold the property as tenants in common in equal shares.

Tenants in Common:

This means that each owner has a defined share in the property. If one of the joint owners dies, his or her share will not pass automatically to the surviving owner(s). Instead, it will go to whoever he or she has nominated in a will (or if there is no will the rules of intestacy will determine who inherits a share of the property). In the event of separation the owners will be entitled to a share in the proceeds of sale of the property equivalent to each of their defined shares.

If you are thinking about holding a property as tenants in common you need to consider and agree what share each owner will have in the property; this could be equal or you could agree different shares depending upon various factors.

Think about:

• Who provided the deposit funds?
• Has a third party who might expect an interest in the property contributed to the purchase price?
• How will responsibility for outgoings be allocated?

There are no right or wrong answers and we would be happy to talk though the options with you to agree upon a structure that works for you.