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McCoy Mortgages does not charge a fee for a residential mortgage or protection insurance advice and applications. Other charges by lenders or insurance providers may apply. Please ask for a personalised illustration. McCoy Mortgages is a trading style of Keith McCoy Associates Limited. Keith McCoy Associates Limited is authorised and regulated by the Financial Conduct Authority, FCA number: 450724. Registered office: Unit 77 Cariocca Business Park, Sawley Road, Manchester M40 8BB. 

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When Two Become One

April 30, 2019

 

Buying a new property is probably the biggest financial commitment any of us make.

If you are buying as a couple it’s essential you choose the right type of joint ownership that properly reflects your situation. The type of ownership affects what you can do with your property if your relationship with a joint owner breaks down or if one of you should die.

Many people aren’t sure of the differences between buying as Joint Tenants or Tenants in Common. For example, many people assume a property will automatically go to their partner in the event of their death or they’ve got equal rights to a property in the event of a divorce. However, this is not necessarily the case, which is why you need to carefully consider which type of ownership best suits your circumstances and your relationship with your fellow buyer(s).

So which ownership type is right for you? Understanding the differences is key and can be summarised as follows:

Joint Tenants

  • Each owner has equal rights to the whole property

  • If one joint owner dies, property ownership automatically goes to the surviving owner

  • For the property to be sold, both owners must first agree to the sale and any proceeds from the sale are split equally

  • A joint owner cannot pass on their ownership of a property in their will

Tenants in Common

  • Ownership doesn’t have to be split 50/50: borrowers can own differing shares of the property

  • Property ownership does not automatically switch to the remaining owner if one joint owner dies

  • Once both owners agree to sell the property, the proceeds are split depending on the number of shares each owner has

  • Joint owners can pass on ownership of the property in their will

It’s worth pointing out that customers can change ownership type between Joint Tenants and Tenants in Common and vice versa by getting in contact with Land Registry.

  • For example, if customers who purchased as Joint Tenants divorce or separate and then want to leave their share of the property to someone else, they can switch to Tenants in Common

  • Conversely, if Tenants in Common get married and want to have equal rights to the whole property they can request a change to Joint Tenants

 

FOR MORE INFORMATION FROM THE GOVERNMENT CLICK HERE 

 

You may also like to read my First Time Buyers page, CLICK HERE

 

My full guide to mortgages has lots of good information for you, CLICK HERE

 

For anything else please contact me for free advice and assistance CLICK HERE

 

 

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