BUYING A HOUSE TOGETHER – JOINT TENANT AND TENANTS IN COMMON
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BUYING A HOUSE TOGETHER – JOINT TENANT AND TENANTS IN COMMON

OWNERSHIP RIGHTS – WHAT YOU SHOULD KNOW

When you buy a house together as a couple, it is a big step. Or it may be that a pair of friends decide they can have a more substantial property if they pool their resources. When the time comes to sell, and maybe move on separately, or if one of the couples passes away, what happens to their share of the property? Before signing on the dotted line, to make the purchase it is always best to understand the implications and ensure that the property, on the exit of either party and your position, with regard to where the sale monies go, is secure. Couples who are unmarried, do not have a civil partnership or Pre Nuptial agreements, (or even if they do), can ensure that their portion of the property is correctly and properly in their ownership. Thus any proceeds of the sale are undisputed. The two most commonly known ways to hold a property together are as a Joint Tenant or as Tenants in Common. The names sound similar but there are very significant differences between them.

WHO IS A JOINT TENANT?

Joint Tenant is most common way in which a married couple, or a couple who are in a long term relationship, own a house together, although it can be used in other circumstances. What does it actually mean to hold a house in as a Joint Tenant? Both people who own the house own it equally, perhaps most importantly though there is a right of survivorship. The practical meaning of this right is that if one of the couple passes away, the survivor automatically has the property ownership of the other passed to them and becomes the sole owner of the property.

When you buy a property, it is automatically assumed in law that this is the way you are buying it. So unless you make a different arrangement the property will be placed as if you are Joint Tenants and the right of survivorship will be automatic. If this is not what you want when you are making a property purchase you must be clear with your conveyancing solicitor and enter into a different arrangement.

WHAT IS A TENANCY IN COMMON?

This is a Tenancy which can reflect different shares of ownership in a property. A common example is where one party puts in 75% of the deposit but the other only 25%. An alternative to this can be where one party is paying all of the mortgages and they agree that when the property is sold 75% of the residual sale funds will belong to that person. The scenarios of different ownerships are many and varied and always best agreed before contemplating the property is purchased.

The basic difference between the two similar-sounding ways of ownership are that if you are in a Tenancy in Common there is no right of survivorship. Each owner can dispose of their share whenever and to whomever they please.

This type of tenancy would suit three friends who join together to buy a bigger property and this Tenancy in Common allows for each one of them to sell their share to the other two or anyone else for that matter. Alternatively, the whole property can be sold and each friend receives their share of the residual sale monies in line with their original investment. Alternatively, if you are a couple who have adult children from a previous relationship, and you would like your share to pass to them, this is the arrangement that may best suit you.

Although it is more common for two people to buy a property together you can, through a Tenancy in Common have up to four people as co-owners of a property. More than four and a Deed of Trust will be required.

DEED OF TRUST

In certain circumstances, when a Tenancy in Common is set up, it would be advisable for a Deed of Trust to be drawn up. Also known as a Declaration of Trust this document sets down in writing how the property was purchased. So, for example, who paid how much deposit and what should happen, from a financial standpoint if:

  • The relationship breaks down and the property is sold;
  • One person is unable to meet their financial obligations toward the mortgage payments, for example if they are made redundant or fall ill;
  • If either party decides they wish to sell.

This document has legal standing and can protect each party’s financial contribution.

In the case of joint mortgages, the mortgage lender will be able to claim against both parties equally for payments. So even though there are two of you on the mortgage, if one person cannot pay their share the mortgage the mortgage company will be able to ask the other to pay the whole of the mortgage repayments.

If one person to a joint mortgage defaults and the other cannot keep up the whole payment it could also effect that persons credit a rating.

CHANGING A JOINT TENANCY INTO A TENANCY IN COMMON – WHAT YOU NEED TO KNOW

This change is known as ‘severing’ a joint tenancy. If all of the owners agree to the change, an SEV form needs to be filled in and filed with the HM Land Registry. There may also need to be supporting documents attached. This creates a ‘form A restriction’. Information such as address, which local authority the property is situated under, the details of all of the owners, plus any applicable fee needs to be sent with the form. The register then holds a note against the property which confirms that the property is held as a Tenancy in Common rather than as a Joint Tenancy. It prevents for example, in the case of a severed Joint Tenancy, on the death of one of the joint tenants, the surviving joint tenant selling the property on his own. This ensures that the share of the deceased Tenant in Common goes to whomever it is bequeathed.

However, sometimes not everyone will agree to this, say in a divorce or the break down of a relationship. In such circumstances, a Notice of Severance is served and the Land Registry will reflect this and the change of the Joint Tenancy to a Tenancy in Common.

In what can be a stressful time, it is imperative that if these circumstances arise you ensure that you update your will to reflect how you would wish your share of the property to be disposed of in the event of your death.

It is also probably worth noting, in respect of a divorce, a will that mentions a husband or wife these aspects of a will are invalidated. In the case of remarriage, a new will should be made as any existing will becomes invalid after the marriage has taken place.

If you are buying a property and would like to discuss the various options above, please feel free to contact us.

What our clients say

Great value for money. Everything went smoothly and I was very pleased with the service provided
Rachel Whitfield
Rachel Whitfield
20:59 12 Oct 18
Excellent! Very responsive, and really helped to push the purchase. There were unexpected delays during the process, but Anthony really helped to reassure me that he was doing everything he could to progress the sale. Ultimately, it all worked out in the end, and I would highly recommend! I would also recommend for auction purposes.
Sean Stevens
Sean Stevens
09:14 21 May 18
Very happy customer. Understanding of our needs and recommended a really fantastic solicitor.
Jack Hearne
Jack Hearne
17:49 12 Oct 18
I have just completed the purchase of my flat with them. They were recommend by the estates agents Phillip Arnold and they were fantastic. My case was handled by Milena who was really helpful and always available on the phone. The online system is also really easy to use. If I buy or sell a property I will definitely be using them again.
Sharon Kelly
Sharon Kelly
18:27 20 Dec 17
I used this service following a recommendation. The online case tracker worked really well. I would recommend this service as it's vital in the coordination between Estate Agencies and between Solicitors. The service proved invaluable in helping progress the conveyancing work efficiently and effectively. Completed the transaction just before Christmas having instructed the Solicitors on the 4th.
Shelly Harrill
Shelly Harrill
16:30 19 Dec 17
Excellent Service. Final Price same as quoted.
A Google User
A Google User
14:26 19 Dec 18
Have used them twice. Both times completion happened in less than 4 weeks, even over Xmas! Totally amazing. They take the stress out of the whole process.
Daniel West
Daniel West
13:04 21 Dec 18
Excellent Service. Final Price same as quoted
Parsa Khamooshi
Parsa Khamooshi
15:54 21 Dec 18
Being a first time buyer they guided me smoothly through the whole process of moving into my first home. Very professional and economical.
Uday Seth
Uday Seth
12:31 24 Dec 18
Express Conveyancing have been excellent in the handling of my recent house sale and purchase. Would highly recommend
James Ellis
James Ellis
11:43 30 Apr 19
Express Conveyancing have been excellent in the handling of my recent house sale and purchase. Would highly recommend
Michelle Preston
Michelle Preston
12:20 30 Apr 19
ThanksThanks for handling my sale and purchase. No complaints from me. Rebecca was regularly on hand to help with my queries and deal with issues.
Claire Miles
Claire Miles
17:48 07 May 19
I bought my first home in South London with Express Conveyancing . Great professional service, I was regularly updated and looked after. Top marks, 100% recommendation from me!
Dale Griffiths
Dale Griffiths
15:58 02 May 19
Good service and happy with the conveyancer
Chris Jenkins
Chris Jenkins
22:01 17 May 19
Great service from start to finish. Was great being able to see progress online! Very quick and efficient! All staff were helpful. Highly recommend
Reece Moseley
Reece Moseley
06:20 30 May 19
I would highly recommend them. They deal with any queries promptly and efficiently. Would definitely use them again.
Sahar Dalini
Sahar Dalini
09:13 10 Jun 19
Fair prices good efficient service
Sue Batchelor
Sue Batchelor
18:46 01 Jun 19
I would highly recommend them. They deal with any queries promptly and efficiently. Would definitely use them again.
Sahar Dalini
Sahar Dalini
09:14 10 Jun 19
This company does not provide conveyancing services directly, they are an introductory company, paid by solicitors to get clients for them. Once you engage with a conveyancing solicitor suggested by them, they don't interfere, and how quick or slow the process is depends on that solicitor that paid them to recruit you. In our case the solicitor was pleasant and corteous, but a bit relaxed, and the whole process took about 9 weeks - about average, but there was nothing "express" about it.About the app to track progress, it is updated by the conveyancing solicitor, so its its usefulness depends on how much he engages with it. In our case, not so much.
Pedro Silva
Pedro Silva
18:27 02 Oct 19
Absolutely outstanding service provided by Rebecca. She really got things moving when they came to a halt. I was moved within 9 weeks. If it wasn't for Rebecca, the move wouldnt have happened that quick. Definitely use EC again in the future.
Sara Kawsar
Sara Kawsar
11:35 03 Oct 19
we purchased a new build flat. The staff at Express were very helpful in finding us our solicitors who was great.
Carl Devenport
Carl Devenport
14:48 26 Sep 19
great service. Completed quickly as promised
Mark Slavinski
Mark Slavinski
16:52 24 Sep 19
Was looking for a modern solicitor with an online website status page so you can live track your progress. The service was fast and they assigned us with a solicitor firm, which was very fast, efficient and pleasant to deal with. HIGHLY RECOMMENDED
Cedric Tomas
Cedric Tomas
21:29 13 Mar 20
Express provided me with an excellent firm (WYM Legal) and had a good portal for keeping me updated during the process. The portal did lack detail but nonetheless meant slightly less chasing.
Sarju Shah
Sarju Shah
10:50 11 Apr 20

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