When you bought your family home or other property jointly with your partner (and in this article when I say partner I also mean your husband or wife) the solicitor who dealt with your property purchase should have asked you to complete a form to let him or her know if you wanted to buy the property as “joint tenants” or “tenants in common.”
If your marriage or relationship is breaking down, it is important that you revisit the information you gave to your solicitor at the time and find out if you are holding your property with your partner as joint tenants or tenants in common.
What do these phrases mean? They have nothing to do with leases or tenancy agreements! I am not sure who thought it was a good idea to use this rather confusing terminology. In this context “tenancy” just means ownership. The concept of a joint tenancy or tenancy in common can be a difficult one to grasp even for family lawyers.
Meaning of tenancy in common
This is where your joint ownership of a property gives each of you a separate quantified share in that property. You can each hold an equal share in the property or different shares that reflect the amount that each of you paid for the property. If you own a property jointly with someone as a tenant in common you can leave your share in that property to whoever you choose in your Will.
Meaning of a joint tenancy
If, on the other hand, you own a property with your partner as a joint tenant this means that both you and your partner own the whole of the property. You will not have a quantified or separate share in that property, and you will therefore not be able to leave your “share” to someone else in your Will. If you die, your “share” in the property passes automatically to your partner.
Severing the joint tenancy
If your marriage or relationship is breaking down and you are looking to separate out your property and other finances from your partner, then you will need to think about severing that joint tenancy. This is the fairly simple process of converting the joint tenancy to a tenancy in common.
Why severing the joint tenancy might be important
Here is an example of what could happen if you do not sever a joint tenancy;
Janet and John decide to buy a home together. Janet recently got divorced and she has received a lump sum of money from her divorce settlement. That lump sum is used for the deposit on their new home.
John is also divorced. He earns a good income, but he has no money to contribute towards the deposit. He gave his old family home to his ex-wife.