When family members, spouses, associates, friends or any individuals purchase a property together, this is called Joint Ownership of Property. There are many circumstances to a joint ownership, with it either being to get a higher loan or just for investment purposes. Regardless of the purpose, there is a need to understand the nature and obstacles of joint ownerships.
First and foremost a joint ownership will place a limit on your rights and privileges as a property owner and also in the event where there is a need for ownership transfer. Whatever disagreement that arise from the joint ownership between the parties have a direct effect on how the property will be handled.
The first step before even signing up for a joint ownership is to have a clear understanding about the property itself and also the actual agreement between parties.
All parties should first come to an agreement in regards to the term of yield (either long or short term), the responsibilities and contributions, settlement of quit rent, mortgage, loans assessments and so on. Facts and figures should be clearly stated (preferably written down).
This is not only to protect yourself when things go south in relationships, unexpected deaths, and even when selling the property in the future. Take heed that after the death of any joint-purchaser, their respective share will come under the laws of intestacy and be assigned appropriately. The surviving joint-purchaser would need to acquire a court order when intending to sell the property. The court order is to be acquired by any named beneficiaries before the sale of the property.
For most joint ownerships, the owners, aptly named joint-purchasers, are by law (Section 342(1) of the National Land Code 1965) considered equal in the ownership unless stated otherwise in their agreements when newly registering the property. This is why it is ultimately crucial to have a proper agreement to prevent any future misunderstandings or conflicts.