You can buy a property with anyone you choose, including your husband, wife, brother, sister, friends, mother, daughter etc.  Before you buy a house with someone else it’s important to understand the ways you can hold a property. As well as how each type protects your legal and beneficial interests.  

Generally speaking, any purchaser will be registered as a legal proprietor of a property who will have a legal and beneficial interest. However, some individuals may want more protection for their interest in the property. This can do this by holding a specific share in the beneficial interest and in turn creating a trust. 

We will list the options for owning properties below:

Joint tenants

When you purchase a property with another party or parties, you will be the legal and beneficial owners. joint tenants share equal ownership and rights over the property. There is a right of survivorship meaning if one owner passes away, their legal and beneficial interest in the property automatically passes to the remaining proprietor(s) regardless of any will that has been made by the deceased owner. 

Where a joint tenant passes away leaving a remaining proprietor, no grant of probate is needed for the surviving tenant to sell the property. This option of home ownership is mostly chosen by married couples, civil partners or those in long term relationships.

There are advantages and disadvantages to holding the property as joint tenants:

Advantages

• You can combine the incomes of all parties and buy a more expensive property
• Upon the death of a joint tenant owner, no grant of probate is needed

Disadvantages

• If one buyer has a poor credit score, this could impact on mortgage affordability and mortgage availability
• Where purchasers buy with mortgage funding and a co-owner fails to fulfil their obligations to the lender, in payment of the mortgage, the other joint owner(s) will be responsible for the mortgage payments 

Tenants in common

Tenants in common means that you hold the property as legal owners together, but you are protecting your beneficial interest. For example, if one purchaser was making a larger financial contribution towards the purchase of the property, this can be protected by way of a Declaration of Trust or by them holding a greater percentage of the beneficial interest i.e. they own 60% of the property and the other tenant in common owns 40%. 

Where a beneficial interest is protected, this is represented on the title deeds as a restriction.  This restriction shows there is a trust and that the share of any deceased owner may not automatically pass to the remaining co-owners.  Therefore, when any co-owner who is a tenant in common passes away, a grant of probate is needed to ensure that their share is distributed in accordance with their will.

It is important when you are a tenant in common that you make a will to govern what happens to your beneficial interest. 

Again, there are advantages and disadvantages of being tenants in common

Advantages:

• Your will ensures who benefits from your share of the property, i.e. children from a previous relationship, charities or your co-owner 
• It protects your interest in the property from creditors as they would only be able claim against the value of the share of the property you own

Disadvantages

• On the death of a tenant in common, if the deceased’s will doesn’t give the ‘right to reside’ until the death of the remaining tenants in common, then they could be forced to sell the property to release the beneficial interest of the deceased owner 
• Grant of probate will also need to be applied for as the share in the property is not automatically transferred

Sole Ownership

Where you purchase a property alone, you are the sole legal and equitable owner of the property.  However, if you have adult occupiers like a spouse or civil partners living at the property as their main home, they may get beneficial and legal interests in the property. This could be done by claiming matrimonial home or occupiers rights. These rights could be quantified by way of contribution towards mortgage payments, bills, renovation etc. 

As a sole legal owner, it would be important to ensure that you create a will to appoint an executor to deal with any property sale or transfer in the future and to appoint a beneficiary who would inherit your property upon death. The executor would then need to apply for a grant of probate to sell or transfer your property.  

As a sole legal owner, you are responsible for all mortgage payments, upkeep of the property, and all necessary maintenance.