Tenants in Common and Joint Tenants?

What’s the Difference and Why is it Important?

JOINT TENANTS:

If you own your home as joint tenants with your spouse then on your death your surviving spouse will automatically take your interest in the property.

Think of your ownership as joint tenants as the seed inside of the avocado, undivided always together. One dies, the survivor takes the whole.

TENANTS IN COMMON:

If you own your home as tenants in common with your spouse then on your death your percentage interest in the property forms part of your estate and is dealt with in accordance with your Will (if you have a valid Will).

Think of your ownership as tenants in common as the rest of the avocado, divided in half or whatever portion you agreed on. That's your share of the avocado, I mean property, that passes via your Wills on your deaths.

Why is it Important?

How you own your property with your spouse or another person is particularly important for:

• blended families

• second/subsequent marriages

• where there are step-children, children and/or other dependents

• where you want to ensure your assets pass to your children on your death or your family on your death

• where you want to ensure your assets pass via your Will (or not) for asset protection

For example, Barry and Iris are married and have 2 children together. Iris has a daughter from a previous relationship. Their main asset is their home and they own it as joint tenants. If Iris dies first then Barry will take the home 100% being the surviving joint tenant. Who ultimately inherits the home will then be up to Barry’s Will when he dies leaving no protection for Iris’s daughter.

How do I decide which is right for me?

How you own property and how you structure your estate is a very personal decision.

Legal advice ought to be obtained to ensure that the consequences of your choices are intended.