Joint Ownership

October 25, 2017

We all know that buying a property can be a stressful time but also a very exciting time as it is a new chapter in your life. We would like to make that process as easy as possible for you especially when you are purchasing a property with your partner, spouse, family or friend and you are struggling to decide whether you wish to hold the property as ‘Joint Tenant’ or ‘Tenants in Common’.


Already confused? Do not worry of the two terms mentioned above as I will breakdown what each term means. You will then be able to decide which method suits you and your situation best.


As Joint Tenants, this can also be known as ‘beneficial joint tenants’ (like conveyancing is not confusing enough and for some reason they like to throw into the mix other multiple words for the same word – beware there may be many like this to follow) you will own the property equally and have equal rights. By opting for this, a rule known as ‘Survivorship’ applies. Survivorship means that if one owner should pass away then the property automatically goes to the surviving owner. It is imperative to understand that you cannot pass on your ownership of the property by way of Will.  Most married couple will usually opt for this method, however please take into account all of the above before making your decision.


If you have a change of heart or circumstances then it is possible to change your ownership from Joint Tenants to Tenants in Common at any time, this is called to ‘Severance of Joint Tenancy’ and this can be done by either party at any time without the other owners’ agreement by serving a Notice of Severance in accordance with section 36(2) of the Law of Property Act 1925. Once this has happened, the property is then held as Tenants in Common and therefore each owner is free to leave there share of the property to whoever they wish.


Now the difference of holding the property as Tenants in Common is that each owner can own different shares of the property. This can be whatever share you seem fit for your situation for example it could be 50/50, 70/30, 90/10. With this option, the property does not automatically go to the other owner if you die and you are able to pass on your share of the property in your Will or if no Will has been created then under the Rules of Intestacy. This option is usually used by business partners, unmarried couples, cohabitees. This is also recommended to parties that have contributed towards the property by way of unequal deposits/repayments.


If you are thinking of choosing this option, it is vital that you make a ‘Declaration of Trust’ deed. So what is this ‘Declaration of Trust’?

The information provided in all of our blogs reflects only a narrative of some elements to consider on the topic. The blogs do not contain considered legal advice and should not be relied upon as advice. Please see our website terms and conditions for full details of our disclaimer. If you are interested in obtaining advice, please contact one of our lawyers who will be happy and able to advise you on your own particular circumstances.