Despite the financial crisis, now is one of the best times to buy a home.
But what happens if you and someone else wish to buy a home together? How do you both claim joint ownership of a house?
This detailed guide will show you how property ownership works when you have a joint tenancy. It is crucial to understand who owns the property title and how the rights of survivorship work.
Here’s what you need to know:
What Joint Tenancy Involves
A joint tenancy is a legal agreement that allows multiple homeowners to own a property. It asserts that all owners have the exact same rights and obligations with regard to the property.
This ownership also creates the rights of survivorship. This ensures that the property ownership continues and transfers to the surviving parties if one or more parties die.
If any party wants to take full ownership or withdraw ownership, they’ll need to hire partition lawyers.
Legal Involvement
There are other legal involvements that are needed in certain circumstances revolving around the rights of ownership.
For example, how does the deceased party have his or her assets distributed? If these aren’t clearly defined in advance, probate is often necessary.
It’s always wise to state this in one’s will. For example, which furniture belongs to which party? What obligations are transferred to the other owner?
These are all questions you’ll have to ask and consider before opting for joint ownership of a house.
Should You Consider Joint Ownership of a House?
Now, let’s look at some of the pros and cons of considering joint ownership. The advantage is that the responsibilities are shared. This means that if you’re on a mortgage, you don’t have to pay 100% of the monthly payment.
However, this also means that you don’t have 100% ownership of the property. Let’s assume you wish to rent out your property. You can’t do this without the other party’s permission.
If the other owner is your spouse, there can be issues after divorce. For example, all debts will be owned by both parties. But one party can’t sell the assets without the other’s permission.
It also means that assets, in most cases, will go to the other party as opposed to heirs.
However, joint tenancy is often considered a great option since it saves you from having to draft a will in most cases. It also ensures that, in most cases, any involvement of the courts is unnecessary.
That’s How Joint Tenants Operate
Now you know whether you should consider joint ownership of a house when looking to buy a property.
It ensures that both parties have equal rights and responsibilities regarding property. It can save legal involvement and doesn’t require one to create a will.
However, it has its advantages and disadvantages as well. You should consider if you’re willing to give away your assets to the joint owner as opposed to your heirs.
While you’ll lose certain authority, you’ll also be relieved that you don’t carry the full burden of responsibility.
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