If you are joining with someone else to buy property; whether a house or land, at some point before the purchase is complete, you will have to decide on the legal terms under which you will share ownership. Will you have a joint tenancy agreement? Or will you choose to become tenants in common. To help you understand co-ownership, here is an explanation of the two types of agreement.
Under this arrangement, no one has a distinct share in the property. When one of the owners dies, his share of the property (that is, his interest) automatically passes to the surviving owner(s). This arrangement will continue until there is only one survivor who then becomes the sole owner. It is only this last owner who can will the property to whomever he chooses. In other words, as long as there are other partners alive, a joint tenant is not entitled to pass on his interest in the property by a will.
No joint tenant can prevent or exclude the other(s) from enjoying any part of the land or property. If the land is to be sold or rented, all the partners must agree. Each joint tenant will share equally in the proceeds of sale or the rental income.
It is common for co-owners who are husband and wife to select a joint tenancy arrangement especially where the property in question is the matrimonial home.
Tenancy in common
Tenants-in-common have distinct, fixed shares in the property. This means that each tenant-in-common is free to sell or leave his share in a will, to whomever he pleases. If he should die without leaving a will, the property will pass to his heirs in the order established by law.
Tenants in common may have unequal shares in the property. For example, Richard can have a one fourth share in the property and Theresa a three fourth’s share.
Tenancy in common is useful for situations where the co-owners contributed separate and unequal sums of money to buy the land and each one wants his contribution to be reflected in his legal interest on the property.
Please think carefully before deciding the type of tenancy. Any request for change on a title document is costly.
For more NHT information, visit our website at www.nht.gov.jm