Ownership of Property – The Options
When two or more people have decided to purchase a property together it is very important to understand the different types of joint ownership available:
Option 1 – By Joint Tenancy
If people hold the title as joint tenants, they each own all of the property and if either of them die, the entire property automatically transfers to the other party on survivorship. This is the manner in which married couples own family homes and other properties. Please note that if the Deed / Transfer does not specifically state the shares owned by the parties, the law presumes that it was the intention of the parties to create a Joint Tenancy. This presumption has serious implications for parties who are not related by marriage, as the Tax Threshold between them is only €24,841.00 (indexed) at present.
Option 2 – Tenants in Common
If people are purchasing as an investment , in partnership, with friends or siblings or in contemplation of marriage at some point in the future, it is preferable to take the title as Tenants in Common. This means that both parties own a share of the property, depending on the proportion of the purchase monies provided by each . The Deeds states specific proportion owned e.g. 50/50, 60/40, 70/30 etc. On the death of a Tenant in Common, their share passes to their Estate and not directly to the other Joint owner. For anyone thinking of buying property in partnership, for whatever reason, it is recommended that a legally binding agrement be put in place. It should cover the following :
- Who the joint owners are and what financial contribution they made
- How long the agreement should last for
- What happens if one of the parties dies, or wants to realise his / her / their share of the property : should the other parties have first option to buy or should the property be sold and the proceeds divided
- What arbitration mechanism should be used to evaluate the property in the event of someone leaving
- Does a partner have the right to sub-let and must that person meet with the approval of the other parties
- Can one of the partners to the agreement take in a boyfriend/girlfriend ?
Comments
2 Comments on Ownership of Property – The Options
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Brandy on
Mon, 17th Dec 2007 5:26 pm
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Hara on
Mon, 31st Aug 2009 1:15 am
My fiance has been paying the mortgage the entire time that we have lived in the house. We separated 9 months ago. He left the home but, is still paying the mortgage. Can he recover the money he spent in mortgage monies…….at settlement?
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