Tenants in common are individuals who share joint possession of real property. A tenancy in common is the most common type of joint possession. It is a form of real estate title wherein more than one person possesses a share of a property. A tenancy in common is the most favored form of joint possession.

The tenancy in common is formed when the tenants in common have unity of possession, or, in other words, share the property together. Two or more of the tenants in common each possess a share of the entire property. Although their shares may or may not be equal, each of the tenants in common is entitled to possess or use the entire parcel of land.

All of the tenants in common are not required to take possession at the same time. There is no right of survivorship in a tenancy in common, unlike in a joint tenancy. The majority of jurisdictions presume that property that is held by more than one individual is a tenancy in common arrangement.

The majority of courts presume that a devise to two or more unmarried persons creates a tenancy in common. If the type of joint possession of real property is unclear, most courts will assume a tenancy in common. A tenancy in common interest can be transferred at any time during the individual’s life. It can also be devised after their death.

A tenancy in common is created by a tenancy in common agreement. An example of tenancy in common would be if Person A and Person B purchase a home together for $100,000. Person A pays $75,000 and Person B pays $25,000. They create a tenants in common agreement where Person A owns a 75% share of the property and Person B owns a 25% share of the property. Although Person A paid more, both individuals have an equal right to use the entire home.

Do Property Interests Have to be Equal Between Tenants in Common?

No, property interests do not have to be equal between tenants in common. Each individual may hold an unequal share of the property, but they share tenants in common rights and liabilities.

For example, in an arrangement that includes three tenants in common, one tenant may hold an interest in half of the property while the other two each have a ¼ interest. Each tenant is entitled to utilize the entire property, so long as they still own their portion.

Can Tenants in Common Transfer Their Property Interests to Other Parties?

Tenants in common may transfer their property interests to another individual at any time during the life of the tenant. This may be done in a number of ways, including:

  • Through a sale;
  • By gift; or
  • By devise in a valid will.

However, in most cases, a tenant cannot transfer the property interests of another tenant.

What Is the Difference Between Joint Tenants and Tenants by the Entirety?

There are significant differences between joint tenants and tenants by the entirety. Tenants by the entirety means that spouses own a property together, as a single entity. This is in opposition to the fractional ownership of tenants in common.

An advantage of a tenancy by the entirety is that a creditor attempting to collect a debt owed by one spouse cannot place a lien on or sell the property to satisfy the debt. The property may only be attached or sold by a creditor of the couple.

A tenancy by the entirety can only be created by a married couple. Married couples purchasing property are presumed to own the property as tenants by the entirety, unless otherwise specifically stated in the deed.

One of the tenants by the entirety cannot transfer or sell their interest in the property without express written consent from the other tenant. If a tenant passes away, their interest passes to the surviving spouse, not to other heirs or beneficiaries.

When a Tenant in Common Dies, What Happens to the Tenant’s Interest in the Estate?

A tenant’s interest in a tenancy in common may be transferred in a will. If the tenant does not have a valid will at the time of their death, their share of the property will be distributed according to probate laws. The decedent’s share will pass to their heirs through a will or through probate rather than to the surviving tenants.

A tenancy in common does not include the right of survivorship as in a joint tenancy. The right of survivorship in a joint tenancy permits the remaining tenants to take over a tenant’s share of the property if they pass away.

How Can I Terminate My Tenancy in Common?

There are several different ways to terminate a tenancy in common. Although tenancy in common laws may vary by state, tenants in common may terminate the tenancy in one of the following ways:

  • By an agreement between all tenants in common;
  • By a court-ordered partition, which is either a physical division of the land or a partition by sale; or
  • By ouster, meaning any act which unlawfully deprives a tenant in common of their share of the property.

An agreement with the other co-tenant(s) to sever a tenancy in common makes each co-tenant the sole owner of their share of the property. It is important to note that it may be difficult to divide property into shares that reflect the value of the percentage owned by each co-tenant.

If the tenants are unable to agree on how to divide the property, they may terminate their tenancy in common by requesting judicial partition of the property. There are two kinds of partition, partition in kind and partition by sale. Partition in kind is a physical division of the property determined by the court.

If it is not possible to equitably divide the property, a partition by sale will occur. In a partition by sale, the court forces the sale of the property and each co-tenant receives their share of the profits.

A tenancy in common may also be terminated by ouster which is the wrongful dispossession or exclusion of an individual entitled to possession of property. Every state has different laws regarding what constitutes ouster. Ousting a co-tenant terminates the tenancy in common. However, if an individual ousts a tenant, they may be sued by their co-tenants for their portion of the fair rental value, or for judicial partition.

If an individual wishes to give up their interest in the property, they may transfer your tenancy in common interest to another person through gift or sale. This does not terminate the tenancy in common, but instead substitutes a third person for the individual who sold their share in the tenancy in common.

Should I Contact a Lawyer for Disputes with Tenants in Common?

Yes, it is essential to have the help of an experienced property lawyer for any tenancy in common disputes. If you have any questions regarding tenancy in common rules, a lawyer can help. A lawyer can help during any step of the tenancy in common process, even before an agreement is made. They can assist in drafting the agreement, handle distribution of property shares, and represent you in court should any disputes arise from the agreement.

Your lawyer can also assist with the gift or sale of your tenancy in common interest or through the process of judicial partition or ouster. An experienced attorney will ensure you receive your fair share when a tenancy in common is terminated.