Tenancy in common is an arrangement where two or more people own an undivided interest in a property. This form of co-ownership is different from joint tenancy in that the tenants do not have rights of survivorship; meaning, when one of the tenants passes away, their interest in the property is passed on to their heir or heir(s) of their choice.
Tenancy in common is often found in business situations where two or more owners have agreed to share ownership of a specific property. In this situation, the property can be leased or sold without the consent of the other tenant. It is important to note that while tenants in common may own an undivided interest in a property, they are not jointly liable for any debts associated with the property.
Tenancy in common offers an advantageous way to own property if two or more individuals want to share its use and enjoyment while allowing each tenant to establish their own interest in the property. For business professionals, it is important to note that tenancy in common offers a way to pass ownership of property to the next generation, allowing for seamless transition of ownership after the death of a tenant.
Making the Most of Tenancy in Common Ownership
Due to its convenient ownership setup, tenancy in common is an attractive idea for business owners looking to pass down their share of the property to their heirs. Rather than fully transferring the interest to another party, in a tenancy in common situation, the heir can simply come into dower of the deceased’s interest. As such, it offers an added layer of protection for business owners when planning for their succession.
It is important for business professionals to get sound advice from a legal professional when setting up tenancy in common agreements. An experienced attorney can help to ensure a fair and equitable split of the co-owners’ obligations and responsibilities, which is essential for ensuring the seamless transition of property ownership rights.
The Bottom Line on Tenancy in Common
Tenancy in common is an arrangement that allows two or more individuals to share ownership interest in a property, without having to transfer full ownership rights to another party. This setup can be especially attractive to business professionals, as it provides a convenient way to pass on ownership of their property to the next generation after their death, without having to transfer the rights to the heir outright.
For those considering entering into a tenancy in common agreement, it is important to seek sound legal advice from an experienced attorney to ensure a fair and equitable division of ownership obligations.