Engage an attorney to assist in drafting your agreement.
2 Can I Be Forced Into Selling a Joint-Owned House?
3 Can a Co-owner Sell Half of a Piece of Land?
4 Can a Joint Owner Mortgage a Property Without Consent of the Other Owner?
Joint ownership agreements allow prospective owners to articulate exactly how they intend to collaboratively purchase and maintain their property. A well-executed joint ownership agreement can serve to guide owners over their years of property ownership or make prospective property owners realize that they are not prepared to own property with another person.
A co-ownership agreement can set the conditions for the purchase of a piece of property. Because the purchase will be made by multiple people, it is a good idea to determine the parties that will be responsible for the mortgage and when those parties will begin to seek financing. The parties seeking financing can use the timeline to ensure that their credit is in good enough condition to qualify them for a loan. Establishing a timeline for purchasing property also informs members to the agreement of when they need to find a real estate agent to assist with locating the prospective property.
Your co-ownership agreement must articulate who the co-owners are and how they will hold title to the property. Joint owners may hold the property as "tenants in common" or as "joint tenants." Tenants in common own the property severally and each owner may dispose of the property as she wishes. Joint tenants each own an undivided share of the property and frequently enjoy a right of survivorship. Owners holding property as joint tenants with a right of survivorship automatically absorb the undivided interest of a co-owner when she dies.
The purchase price is only the first in a long list of costs associated with property ownership. An ownership agreement may set out who is responsible for recurring costs such as property taxes, association fees and utilities, and when they are to be paid. The agreement may also specify the parties responsible for general maintenance and emergency repairs. If the agreement is detailed enough, then it may also provide direction for what to do if one of the parties fails to live up to their contractual obligations.
If all goes well with the purchase of your property it will, over time, accrue equity. Do not neglect to include a provision in your co-ownership agreement detailing when, if ever, equity should be taken out of your property and how it will be allocated. If your co-ownership agreement allows for a cash-out refinance or a second mortgage, then it is imperative that the agreement also name the owners who are permitted to further encumber the property. Should your agreement call for the sale of the property rather than a refinance, then it should state when and how the property may be disposed of.
Evans, Jerome. "Joint Ownership Property Agreements." Home Guides | SF Gate, http://homeguides.sfgate.com/joint-ownership-property-agreements-80966.html. 02 December 2018.
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