When speaking to us at Fox Stevens Conveyancing about your property purchase, we will need to confirm exactly HOW this property will be owned. In particular, when two or more people own land they can hold the land either as Joint Tenants or Tenants in Common.
As Joint Tenants, you own the property together jointly (there is no specification of shares held). This is the most common ownership type between married and defacto couples. On the death of an owner, the surviving owner will become the sole owner of the land regardless of any direction in any Will of the deceased joint tenant. The surviving joint tenant is then entitled to register a Notice of Death at Land Registry Services (LRS) in New South Wales. There is no separation of the interest held between joint tenants.
From an asset protection and estate planning perspective, there are certain situations where owning a property as Joint Tenants may not be suitable. In this regard, you should seek the advice of a financial adviser and an estate planning solicitor before making this decision.
Tenants in Common
In this format, each owner holds a separate share.
Tenant A and Tenant B may each own 30 percent of the home.
Tenant C owns the remaining 40 percent.
On the death of an owner, that person’s executor must apply to the Supreme Court for Probate of the Will. When Probate is granted, the deceased person’s share is transmitted to the executor who then transfers it to that person’s beneficiaries as set out in his or her Will.
In the example above, if Tenant C passes away, the 40 percent would need to have specific instructions as to who (and what percentage) receives some/all of their share.
Consider Tenants in Common, if (for example):
- You wish to leave your interest in the land to someone other than the other owner(s) (such as where business associates or friends are purchasing land together); or
- You wish to hold unequal shares in land (such as where the contribution of capital by each purchaser is not equal).
Again, from an asset protection and estate planning perspective, there are certain situations where owning a property as Tenants in Common may not be suitable. In this regard, you should seek the advice of a financial adviser and an estate planning solicitor before making this decision.
If you have any questions about your situation, contact us via firstname.lastname@example.org (0414 894 031) or Julie@foxstevens.com.au (0488 325 980) to discuss. We will be happy to provide details of solicitors, should you require an comprehensive review of your ownership requirements.
Please note the information provided is of a general nature and not to be taken as legal advice.