Most home owners own their dwellings as Joint Owners. In law they are called 'Benefical Joint Tenants'. In this instance the word 'tenant' is a throwback to medieval days when everyone was a tenant of the King. This has fallen into disuse and freeholders now own their properties outright.
'Benefical Joint Tenants' own their property as 'One'. If one dies the other continues to own the whole property, so the first to die simply ceases to be an owner upon death. If there were several beneficial joint tenants the last one alive would own the whole property.
'Benefical Joint Tenants' do not have the right to leave their share of the property to others. This often comes as a surprise to many people, and can be an issue if there has been a remarriage, as the children of the first to die might not benefit from the property at all.
If the children are young and still dependant a judge could overturn the arrangement, but that would mean going to court with all the associated legal costs being suffered.
'Beneficial Joint Tenants' cannot sell their share of the property without the agreement of the other joint tenants. So if there is a falling out one might not get their share at all. Nor can a joint tenant install a lodger in the property, and if the others agreed the rent would have to be shared.
'Tenants in Common' each own their share of the property and could sell their share. If there is a restriction registered then that share cannot be sold. A tenant in common does have the right to leave his share to beneficiaries in his Will.
Tenancy in common is often an essential ingredient in an effective Inheritance Tax Solution and other Asset Protection strategies.
We have changed many people from Benefical Joint Tenants to Tenants in Common as part of their Inheritance Tax Solutions and Asset protection Strategies.
