When two or more persons own property together they hold the property as either:
joint tenants OR as tenants in common.
You've probably heard these terms before but what do they actually mean? Knowing the meaning of these terms can help you to decide how you want to hold property with other persons - possibly the property you own with your spouse, business partner, relative or friend.
What is a joint tenancy?
If Sarah and Joe own a piece of land as “joint tenants” it means they share EQUAL ownership of the property and have an EQUAL undivided right to keep or dispose of the property.
When persons own property as “joint tenants” it means that when one owner dies his/her share in the property automatically goes to the surviving owners. This is called the right of survivorship.
Therefore, as joint tenants:
What is tenancy in common?
On the other hand, if Sarah and Joe own a piece of land as "tenants in common" it means they share ownership of the property and have an undivided right to keep or dispose of the property. However, unlike joint tenants who always have equal interest/share in a property, tenants in common may have different ownership interests. For example, Hilda and Tony may each own 25% of a property, while Jill owns 50%.
When persons own property as “tenants in common” it means when one owner dies his/her share DOES NOT go to the other owners; the owner has the right to leave his/her share of the property to any beneficiary he/she wishes.
Therefore, as tenants in common:
Important Notice: This post does not constitute or provide legal advice. Always consult a suitably qualified lawyer on any legal problem or issue.