Tenants in Common Vs. Joint Tenants: the Co-buyer's Guide To Title
When you co-buy a home, the title structure you select identifies more than just what's on paper. It specifies your legal rights, your monetary flexibility, and how simple (or tough) it'll be to deal with alter down the roadway. The problem? Most groups make this contact a hurry - and regret it later on.
At CoBuy, we have actually helped hundreds of groups overcome this option. But here's the reality: no attorney, not even us, can tell you which structure is "right." This is a group choice. It has to fit your contributions, your goals, and your threat tolerance. Many people make it without understanding the trade-offs - or how it fits with all the other co-ownership terms they'll agree on. Our task is to give you the clarity, guardrails, and process to make that decision with confidence.
First principles: what "title" ways (plain English)
Title = legal ownership.
Taking title = how the deed states you own at purchase (your "vesting").
Holding title = the form of co-ownership that governs rights over time - how ownership is shared, what occurs when somebody leaves, how taxes use, and how decisions are made.
The deed is tape-recorded at the county. Your vesting language - e.g., "Alice and Ben, as Tenants in Common" or "as Joint Tenants with Right of Survivorship" - sets the guideline the minute you close. Lenders, taxes, and future transfers all crucial off that choice. Title insurance coverage addresses past defects in ownership; it does not choose how you co-own going forward.
The two structures most co-buyers consider
Tenants in Common (TIC)
Each co-owner can hold an unequal share (e.g., 60/25/15). Legally, each can convey their share. Practically, your mortgage, due-on-sale provisions, and your arrangement will form what's possible. Without protections, a co-owner can sue to partition (force a sale).
Joint Tenants with Right of Survivorship (JTWROS)
All owners hold equivalent shares. When one passes away, their share instantly passes to the survivors - bypassing probate. But in some states, certain actions can sever JTWROS, converting it to TIC. And the equal-only ownership model can clash with unequal contributions.
At-a-glance contrast
Here's how TIC and JTWROS compare throughout the essential elements we see frequently in co-buyer groups.
Choose your title structure with confidence.
Co-ownerOS ™ Annual Pass gives your group the clarity, guardrails, and process to make the best choice - and keeps it documented, protected, and as much as date.
• Understand pros & cons of TIC vs JTWROS
• Spot disputes before they cost you
• Save $10K+ in advance vs. attorney costs
• Prevent expensive disputes & delays
• $400/year covers your entire group (≈ $8.33 pp/mo for 4)
How to pick (useful, not theoretical)
From our experience, patterns emerge:
- Friends pooling resources typically select TIC for flexibility.
- Unmarried couples lean toward JTWROS for survivorship, though some still select TIC for proportional ownership.
- Investment-focused groups frequently require TIC for tax reporting and 1031 exchange versatility.
Over the last six months, majority of the groups utilizing Co-ownerOS ™ have actually picked to take and hold title as Tenants in Common. That's not since TIC is "much better," but due to the fact that for lots of groups-especially buddies or household with unequal contributions-it fits their goals and keeps alternatives open. The rest either pick JTWROS for its survivorship simpleness or, in a smaller sized variety of cases, other structures based upon state-specific rules.
Why this choice is so typically mishandled in the wild
In conventional domestic property, nobody really owns this choice for co-buyers. Realty representatives aren't trained for it. Loan officers frequently avoid the conversation since they see risk. Title and escrow professionals seldom explain the implications-they tend to appear only at signing.
As an outcome, groups frequently get to closing without knowing precisely who is on title, how they have actually taken title, or what that suggests for their future. They secure a structure that conflicts with their contributions, their plans, or both. It's expensive to relax later on - and in the meantime, it can limit their options for refinancing, selling, or dealing with an exit.
Hidden pitfalls we see frequently
Partition claims (TIC): Any co-owner can ask a court to sell the residential or commercial property if you deadlock. Strong contracts add right-of-first-refusal (ROFR), buy-sell triggers, and mediation before court.
Due-on-sale (both): Transferring interests can violate your loan terms unless an exception uses - coordinate with the lender.
Accidental severance (JTWROS): Certain deeds or refis can sever JTWROS depending on state guidelines.
Tax mismatches: Equal title with unequal contributions can raise gift-tax concerns; rental earnings and devaluation reporting need positioning.
Two fast circumstances
Three buddies, 60/25/15, buying a rental
They pick TIC for proportional ownership, tax reporting, and integrated ROFR to keep outsiders out.
Unmarried couple, equivalent contributions, want automatic inheritance
They select JTWROS to avoid probate and guarantee the survivor owns 100% immediately.
How Co-ownerOS ™ keeps you out of the "decision loop"
In the wild, groups get stuck in what we call the choice loop. They select a title structure without recognizing it conflicts with other terms they desire - like unequal ownership interests under JTWROS. Or they rely on an attorney who isn't a co-ownership expert, ending up with mismatched, insufficient documents.
Our Governance flow puts guardrails around every option. If a decision in one area would contravene another, you'll see it right away. We streamline each step with plain-language context and just-in-time assistance so your group can develop agreement without backtracking.
Groups with contributions and expectations already settled on can make this title choice in minutes. The assistance is clear, the conflicts are flagged, and everyone sees the ramifications before devoting. When underlying concerns need conversation, the system surface areas them so they're fixed before moving on. That openness leads straight to non-repudiation: no one can later on claim they didn't understand or agree.
Protect the group (this is where the real safety lives)
Your title choice is step one. Step 2 is the co-ownership contract:
Exit timelines and rates
- Dispute resolution
- Approvals for big expenses
- First rights if someone sells
Getting this right up front avoids conflicts, prevents closing delays, and reduces the need for costly fixes after the reality. It likewise locks in clarity for every single situation that follows - full or partial sale, voluntary or not, and even death. This is among the core choices that specifies how the asset and its liability are structured.
Most of the times, the residential or commercial property is the biggest dollar-value asset (and liability) the group will ever take on, with joint and several mortgage liability. That's why the title structure isn't simply a rule - it's a monetary safeguard.
Co-ownerOS ™ walks you through these decisions, captures consensus, creates your agreement, supports e-signing, and keeps everything present as life modifications - without a $10K legal costs.
FAQ
Why will not my lawyer simply inform me which to select?
Because the "ideal" option depends on your group's particular contributions, goals, and threat choices. Attorneys - and us - can offer you the information and guardrails, but only you can make the call.
Can we switch later on?
Often yes, but expect a brand-new deed, lending institution participation, and possible tax/recording expenses. Plan right in advance.
Does JTWROS prevent probate?
Generally yes for that residential or commercial property interest, however you still need to clear title and manage creditor/tax matters.
Can a TIC owner sell without consent?
Legally yes, but your mortgage, ROFR, and the thin market for partial interests often make it made complex.
What's a partition action?
A suit where a co-owner forces sale or department. It's pricey and sluggish - great contracts aim to avoid it.
Which structure do lending institutions choose?
Most accept both, however numerous need all owners on the note and approval for transfers.
We're buying a rental. Anything special?
With TIC, income/expenses/depreciation typically track your percentage interest. For 1031 exchanges, TIC interests can work - get a CPA involved.
We're married in a community-property state. Another alternative?
Some states use neighborhood residential or commercial property with right of survivorship. If that's you, compare that option too.
Bottom line
Picking a title structure isn't almost closing documentation. It's about safeguarding your financial investment, your relationships, and your options in the future. Co-ownerOS ™ offers you the clarity, guardrails, and procedure to make the right call - and keep it existing.