Joint Tenants vs Tenants in Common
Buying a property can be an exciting time for a person as it brings in its wake not only the pride of ownership but also tax benefits. However, buying a property together with one’s wife or with more people can be a tricky proposition as there are two distinct ways of joint ownership known as joint tenants and tenants in common. As it is very important to decide on the title to the property, understanding the difference between joint tenants and tenants in common, the two types of ownership will be helpful. This article takes a closer look at joint tenants and tenants in common.
Joint Tenants
The best example of joint ownership or joint tenancy is seen in the case of a husband and a wife jointly owning a property. In this case, both husband and wife are treated as joint tenants with both having equal rights on the property. There is no distinction between joint tenants, and both have undivided shares of the property. The law regards both owners as equal, with both of them owning the whole of the property. In such a case, death of one of the owners transfers the right of ownership to the survivor who can sell the property as his own and all he requires is the death certificate of the other tenant.
Tenants in Common
With the tenants in common arrangement, the owners have separate shares of the property that may be equal or unequal. This type of arrangement is seen commonly in instances where the buyers have a relationship such as business partners, just friends, or relatives. It is possible for tenants in common to relinquish their share, sell it, or bequeath it to persons of their choice. One owner can mortgage his share in the property without the knowledge of the other owner or owners. One of the owners can give his share to another person mentioning it in his will before dying.
Joint Tenants vs Tenants in Common
• Joint tenants and tenants in common have nothing to do with tenancy and are two distinct arrangements of joint ownership of property.
• There is no division of property in its shares, in case of joint tenants, and both are considered equal owners of the property.
• In the case of tenants in common, there can be many owners with each of them owning a separate and distinct share of the property.
• In the case of joint tenancy, death of one owner can pass on ownership to the other joint tenant and the right to sell the property.
• In tenants in common, different owners have equal or unequal shares of the property and each can sell or mortgage his share without informing the other owner.