Built to Withstand Time: Jointly Owned Properties
Is it possible to buy a flat jointly with a friend and have it registered in both of your names? Absolutely. However, this involves a range of legal and practical considerations that need to be addressed. This article delves into the various aspects to consider when buying a flat jointly, including different types of joint ownership, legal documentation, financing, and future considerations.
Types of Joint Ownership
Two friends purchasing a flat can choose between different types of joint ownership to suit their needs and ensure fairness in the arrangement. The two main types are:
Joint Tenancy
In a joint tenancy, each friend owns the property equally, and if one friend passes away, their share is automatically transferred to the surviving friend. This form of ownership is simpler and more straightforward but lacks flexibility in terms of individual ownership percentages.
Tenancy in Common
Tenancy in common allows each friend to own a specified share of the property, which can be unequal. If one friend passes away, their share can be inherited by their heirs. This form of ownership offers more flexibility but requires clearer documentation of ownership ratios.
Legal Documentation
To ensure your joint ownership is recognized, it's crucial to have the property deed and registry documents reflect this arrangement. Legal documentation should be reviewed by a professional legal expert to guarantee that the necessary agreements are in place. This step is vital to protect both parties and prevent potential conflicts.
Financing
When taking out a mortgage, both names should be included in the loan application. This is necessary to comply with the terms of the lender and secures the loan against both properties. Lenders typically require joint applicants to share the responsibility of the debt, making it essential to agree on how you will manage finances.
Registration Process
The process for registering joint ownership can vary by location, and it's important to check local laws and regulations regarding property registration. Ensuring that the registration is completed correctly is crucial to avoid future complications and disputes.
Future Considerations
Future considerations include handling expenses, maintenance, and what happens if one wants to sell their share. It's advisable to have a clear agreement in place that addresses these scenarios to prevent misunderstandings and potential conflicts.
While joint ownership offers the benefit of shared responsibility and flexibility, it's important to consider the strength of the relationship between the two parties involved. Shared property often involves more than just financial considerations; it can also strain personal relationships. It's crucial to communicate openly and keep emotions in check.
Legal Perimeters and Practical Advice
Joint ownership of a flat is legally permitted, and each can mention the ratio of their ownership in the sale deed. However, it's important to note that any home loan would have to be sanctioned against both owners, as no lender will agree to provide a loan to just one party. Combining the flat into two portions under the same deed might not be legally permissible, and doing so could lead to tensions and conflicts, even among friends.
Legal measures and practical advice suggest that joint ownership may not always be the best idea, especially considering the unpredictability of future relationships. Splitting the flat into two separate properties could be a more viable option, ensuring clear ownership and reducing the risk of disputes. However, this decision should be approached with careful consideration and open communication.