Tenants in common/co-habitation agreements and Partition Buyout agreements
Co-owning property with a friend, family member, romantic partner, or business associate can be an appealing idea, driven by the shared vision of affordability. And legally sound guidance is essential to ensure a smooth and successful co-ownership experience.
GLO leverages its experience working with clients to help you navigate the complexities of co-ownership and secure a clear and secure path forward that protects both your assets and your relationships.
What Are Tenants in Common?
Individuals who jointly acquire property often find themselves in a default legal status known as “Tenants in Common.” This default allows for shared ownership, but it also comes with inherent challenges. One common issue arises from disagreements about contributions to expenses such as mortgage payments, taxes, and essential maintenance. These disagreements can lead to resentment and create an unequal burden on one co-owner. Without a written framework for managing daily operations, allocating expenses, and other complications, these issues can escalate and cause conflicts.
What happens if there are disputes?
When co-ownership disputes escalate in the absence of a clear legal framework, co-owners are left with the unenviable option of resort to a costly and emotionally draining partition lawsuit. As detailed in our blog Understanding Tenants in Common Agreements and the Pitfalls of Partition, a partition lawsuit involves the Court determining relative ownership interest and in most cases ordering the property be sold at County sheriff ’s auction. The consequences of such a forced sale are almost always detrimental to the financial interests of all co-owners. Properties sold under court order in a partition action are often sold below their true market value because the primary objective is a quick liquidation rather than marketing the property to maximize the sale price.
Without proactive planning, co-owners risk a costly and stressful legal battle that costs the Parties time, attorney’s fees and court costs and ultimately results in a suboptimal sale of the property .
How Legal Guidance Can Lead to a Smooth Experience
In contrast, a well-drafted Tenants in Common Agreement places the control of resolving disputes firmly back into the hands of the co-owners. Guidance from an experienced lawyer can help address disputes before they escalate to the point of partition. While co-owners may initially have an informal understanding of who pays for what, these arrangements rarely account for the full range of costs associated with property ownership or for changes in financial capacity over time. What happens if one party unexpectedly faces financial hardship and cannot fulfill their agreed-upon share? To address these situations proactively, it’s advisable to seek guidance from a lawyer and draft a well-written agreement. Read our blog A Tenants in Common Agreement: Clarity and Protection for Co-Ownership of Real Property for more information.
How GLO Can Help
At GLO, we specialize in providing comprehensive legal guidance for individuals navigating the complexities of co-owning property. Our experienced attorneys are adept at drafting comprehensive Tenants in Common Agreements that are meticulously tailored to your specific circumstances, ensuring clarity on ownership shares, financial contributions, responsibilities for expenses and maintenance, and establishing clear decision-making processes. We proactively include provisions for future contingencies such as buyouts, sales, death, or relationship changes, providing a clear roadmap for resolution and preventing future disputes.
Furthermore, if you are currently facing co-ownership challenges without a formal agreement, GLO can provide invaluable assistance in negotiating and finalizing a Partition Buyout Agreement. Whether you are proactively establishing a new co-ownership arrangement or seeking to resolve an existing dispute, GLO offers the expert legal counsel necessary to clarify ownership rights and obligations, safeguard your financial interests, and ensure a smooth and equitable path forward.
Contact GLO today to ensure your shared property interest is backed by a clear, enforceable agreement.
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