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Tenants in common and joint tenants

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  • #2
    Peregrinus
    Registered Users, Registered Users 2 Posts: 27,254 ✭✭✭✭Peregrinus


    Calahonda52 wrote: »
    https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-19/19-03-07.pdf

    My first question is, for a normal married couple with a mortgage, which one is the default ownership structure: and how is it proven?
    There is no default; the title documents will specify whether the co-ownership is a joint tenancy or a tenancy-in-common.

    For a married couple, joint tenancy is far more common. But that means nothing if in fact your title documents specify tenancy-in-common.
    Calahonda52 wrote: »
    My second question is can it be changed without impacting the mortgage and how is it done?
    You need a solicitor to draw up a document in which the co-owners transfer the property to themselves as tenants-in-common in equal shares (assuming it's currently a joint tenancy). If the property is mortgaged you'll need the consent of the mortgagee - the bank - to do this.

    Changing the nature of the co-ownership will not alter the fact that you will both remain fully liable for the debt due to the bank. If that's what you really want to change then in theory you don't need to change the nature of the co-ownership at all; you can just agree with the bank that each of you is inidvidually liable to the bank for a maximum of 50% of the outstanding loan value. In practice, of course, the bank is wildly unlikely to agree to this; why would they? If by some miracle they were to agree then, again, you'd need a solicitor to document the variation to the terms of the loan.


  • #3
    Calahonda52
    Registered Users, Registered Users 2 Posts: 13,143 ✭✭✭✭Calahonda52


    P,

    Many thanks indeed for this thoughtful and clear contribution.
    The objective is not debt related but trying to achieve this from the link.

    Where a property is held by persons as tenants in common, each is the absolute owner of a due proportion of the property. When such a person dies, his due proportion of the property is deemed for the purposes of Section 573 (Tax Instruction 19.3.9 Par.1 et. seq.) to be disposed of to his personal representatives.

    Thank you again.
    C

    “I can’t pay my staff or mortgage with instagram likes”.



  • #4
    Peregrinus
    Registered Users, Registered Users 2 Posts: 27,254 ✭✭✭✭Peregrinus


    You want to end the right of survivorship that goes with joint tenancy? Yes, you can do this. As I said, you'll need a solicitor to do it for you, and if the property is mortgaged you'll need the agreement of the bank, but I expect this should be forthcoming.

    That assumes, of course, that both co-owners are agreed that this is what they want. If they disagree, then the one who wants to make the change will need to head off to court and look for a court order.


  • #5
    Calahonda52
    Registered Users, Registered Users 2 Posts: 13,143 ✭✭✭✭Calahonda52


    Thanks again.
    Your analysis is correct, step one is to see does the bank actually have the title deeds, they lost quite a few during the boom! :)
    Over and out...for now :)

    “I can’t pay my staff or mortgage with instagram likes”.



  • #6
    OutOfDodge
    Registered Users, Registered Users 2 Posts: 1 ✭OutOfDodge


    I can't seem to figure out how to start a new thread about my question, so apologies for it appearing here.
    I own 50% of a commercial property as a 'tenant in common', with a relative of mine.
    I'm wondering is it possible for me to sell 25% of my share to a third party, releasing some equity immediately while still retaining a quarter share in the property.


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  • #7
    Peregrinus
    Registered Users, Registered Users 2 Posts: 27,254 ✭✭✭✭Peregrinus


    OutOfDodge wrote: »
    I can't seem to figure out how to start a new thread about my question, so apologies for it appearing here.
    I own 50% of a commercial property as a 'tenant in common', with a relative of mine.
    I'm wondering is it possible for me to sell 25% of my share to a third party, releasing some equity immediately while still retaining a quarter share in the property.
    Yes it is. And the upshot will be that the property is owned by three tenants in common in unequal shares - A (your co-tenant) owning 50%; B (you) owning 25% and C (the new guy) owning 25%.

    But two words of warning:

    First, it's very unlikely that anyone will be willing to buy unless your co-tenant - the owner of the other 50% - is on board and happy with the arrangement; nobody wants to buy into a row.

    Secondly, co-owners of a property have to agree about every decision connected with the property; there's no question of majority rule. And, the more co-owners you have, the harder it can be to secure agreement. And it can be harder still if some co-owners have a large share in (and therefore a large personal investment in) the property while others do not. So you don't often find multiple co-owners of property except where they are already in a wider relationship and the ownership of the property is incidental to that - e.g. the partners in a business might be co-owners of the property in which the business is carried on.

    So, it might not be easy to find a willing buyer for a 25% stake in the property. But legally, technically, etc, there's no obstacle.


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