Are you and your partner interested in buying property together, but you don’t know where to start? You may have a range of options available as an unmarried couple and undoubtedly want to carefully consider which one would be best. In this article, we look at the different types of joint ownership in Scotland, and the benefits of having a cohabitation agreement and Will. Our experienced conveyancing solicitors can offer advice specifically tailored to your circumstances. Contact our approachable team today.
Joint tenancy
A joint tenancy is the most common form of co-ownership and is commonly used by unmarried couples. In a joint tenancy, the owners will be ‘co-owners’, and each will have an undivided share in the property. This means that both co-owners own the whole property, and there are no separate shares.
Who is responsible?
The co-owners will be jointly responsible for things any individual homeowners would be accountable for, including paying the mortgage. This means that the mortgage lender will usually be able to pursue legal action against either co-owner if mortgage payments fall behind.
What happens when one party dies?
When one joint tenant dies, ownership of the property will automatically pass to the surviving co-owner. This is known as ‘rights of survivorship.’ The property will not form part of the deceased’s estate, so it will not be affected by what is written in the deceased’s Will.
Tenancy in common
This form of joint ownership involves each owner having specific shares in the property. There is a presumption within the law that joint owners have equal shares in the property. If owners do not want equal shares, they must have a legal agreement saying so. This agreement will specify the number of shares each owner has. If there is a dispute about the number of shares each owner has, this document can be used as evidence of what was agreed upon.
Who is responsible?
In the same way as joint tenancy, tenants in common will be equally responsible for the upkeep of the property and the mortgage. These responsibilities can be changed if one owner wishes to have more responsibility than the other. However, this must be specified in a legal document, such as a cohabitation agreement.
The importance of a cohabitation agreement when buying property
A cohabitation agreement is a legally binding document that sets out the financial arrangements of a couple. It can shed light on any jointly-owned property and set out what each cohabitant will be entitled to should the relationship come to an end. Exactly what is covered in the agreement is tailored to your particular circumstances, our experienced solicitors can advise you on this.
Do I need a Will?
Having a Will is beneficial for a number of reasons, especially if you are not married. Specific shares in a property will not automatically pass to the surviving joint owner should either party die. So, if you have a tenancy in common, you will need to specify what you want to happen to your shares in the property. To ensure that your surviving partner inherits your share of the property, you will need a survivorship clause written into your Will or another legal document.
What is a survivorship clause?
A survivorship clause (also known as a special destination clause) is a formal legal agreement. It may be written into the title deeds of jointly-owned property, in a joint-owners Will or inserted into a couple’s cohabitation agreement.
An agreement like this will mean that when one joint owner dies, their share in the property will automatically pass to the surviving partner. A survivorship clause is commonly used by unmarried couples who want to leave their share of joint property to their partner after they die.
If you want to reverse the effects of a survivorship clause, both joint owners must agree that the clause should be removed from the legal document it is contained in. A qualified solicitor will be able to help you with this.
What happens if we separate?
If your circumstances change and your joint ownership arrangement is no longer working, there are a number of options available. Your options will depend on the legal agreements between the joint owners. Having a cohabitation agreement, which sets out exactly what is to be done in this situation, can save you from this uncertainty. This is why it is important to consider drawing up a cohabitation agreement with your partner, before difficulties arise.
Contact Thompson Family Law Solicitors in Glasgow, Coatbridge, Airdrie & Shetland
Our multidisciplinary team of solicitors have expert knowledge in this area. If you are looking to discuss any legal issues surrounding buying a property, cohabitation or separation, contact one of our team today. Our solicitors pride ourselves in providing high quality and cost-effective legal advice and have a strong commitment to achieving positive results for our clients. We tailor solutions specifically to your requirements, delivering cutting-edge advice and skilful court representation where needed. Contact us now via our online contact form, or give us a call on 0141 404 6575.