Homeownership is promising as there are many avenues available in Real Estate. In Ontario, concurrent ownership is typically divided into two categories: joint tenancy and tenants in common. In a joint tenancy, the partners own the whole property in equal shares, while tenants in common each have a definite share in the property.
When deciding whether you should use a joint tenancy or tenancy in common, it is beneficial to have legal advice on hand. The Lawyers at Minhas Lawyers are well experienced and can provide professional legal advice to help you decide the best choice for you, as for many, these are inexpensive and simple ways to own real estate.
The most common way for married spouses to own a home is through joint tenancy. Here, the land is owned by two or more people in equal shares.
Under these circumstances, if one dies, the surviving joint tenant continues as the owner of the home. There is no transfer of ownership as the deceased is simply removed off title; the surviving parties receive the full interest in the property. This leaves the other tenants’ name(s) on the property. If both tenants die at the same time, the situation is treated as a tenancy in common.
There are four requirements for joint tenancy:
- Unity of Term: everyone has the same interest for the same period
- Unity of Title: owners all have the same interest, at the same time in one document
- Unity of Interest: each person has an identical interest
- Unity of Possession: each person has equal ownership
Joint tenancies come with advantages and disadvantages. On an advantageous note, after a spouse passes, the surviving spouse will not experience title issues. What is more, with joint tenancy, there is also the possibility of tax and mortgage advantages. Comparatively, if there are more than two individuals on title, when one dies, ownership can become complicated.
Tenants in Common
Tenancy in common arises when two or more individuals have a divided interest in a property, evidenced by a percentage. Without the four unities, a tenancy in common arrangement is usually established. Unlike a joint tenancy, under a tenancy in common, survivorship does not exist.
If a tenant in common passes away, their respective share of the property passes to the estate and will be handled in a will or intestacy according to the estate.
Like joint tenancies, tenancies in common also have advantages and disadvantages. Advantageously, everyone can have a different percentage of interest in the property, but also have the capacity to buy or sell a share. More, tenants in common can leave their percentage to their children in a will. Comparatively, if an individual does not want to claim their part of the ownership, problems can arise.
Minhas Lawyers LLP is a multi-practice law firm based in Mississauga. We advise and represent clients across various segments and practice areas.
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