Tenancy in Common Agreement

A Tenancy in Common (TIC) Agreement is a legal contract that outlines the rights and responsibilities of two or more individuals who co-own a property without requiring equal ownership of shares. Each co-owner, known as a tenant in common, has a separate and transferable interest in the real property. Unlike joint tenancy, tenants in common do not have the right of survivorship, meaning that if one owner dies, their share passes to their heirs or beneficiaries, not the other co-owners. A Tenancy in Common Agreement can document terms for occupancy, maintenance, sale, or other property related matters, allowing an orderly and planned management of a real property with multiple owners.

Retainer Fee: $1000.00

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Key Features of a Tenancy in Common Agreement

  • Ownership Shares: Owners can have unequal shares
  • Transferability: Each owner can sell or will their share independently
  • No Right of Survivorship: Shares go to heirs, not co-owners
  • Common Use Rights: Each owner has full use of the property

Benefits of a Tenancy in Common Agreement

  • Flexibility in ownership percentages
  • Estate planning advantages (can be inherited)
  • Ability to include multiple co-owners
  • Investment opportunities in real estate

Risks and Challenges

  • Disagreements among co-owners
  • Difficulty in selling the entire property
  • Potential for partition lawsuits
  • Financial risks (e.g., unpaid mortgage by one owner affecting all)

Essential Clauses in a TIC Agreement

  • Ownership Percentage: Clearly define each owner’s stake
  • Rights & Responsibilities: Maintenance, taxes, and mortgage obligations
  • Dispute Resolution: Mediation, arbitration, or legal action guidelines
  • Exit Strategy: Buyout terms, selling process, and rights of first refusal
  • Usage Terms: Whether owners can live in or rent out the property
  • Decision-Making Process: How major decisions are made

How to Set Up a Tenancy in Common Agreement

  • Choose Co-Owners Wisely – Compatibility in investment goals
  • Draft a Legal Agreement – Work with a real estate attorney
  • Define Ownership Percentages – Based on investment contribution
  • Outline Responsibilities & Costs – Maintenance, taxes, and mortgage
  • Plan an Exit Strategy – Terms for selling or transferring shares

Legal Considerations

  • Importance of a well-drafted agreement
  • Local and state property laws affecting TIC arrangements
  • Tax implications of TIC ownership
  • Estate planning factors

Services Offered by RELAWDOC

  • Flat fee pricing for peace of mind with a clear, upfront cost
  • Easy online ordering
  • Simple information collection process
  • Consultation to verify information and terms
  • Drafting of the Affidavit of Death in compliance with legal requirements
  • Review by an attorney
  • Coordination of document execution and recording as requested (for additional fees)