When talking about property ownership, there are 2 ways you can own property- by yourself or with somebody else. When you own a property by yourself it's called ownership in severalty, while owning property with others is considered a concurrent estate. The two types of concurrent ownership that come up most often on the real estate exam are joint tenancy and tenancy in common. So let's take a closer look at how these two forms of concurrent property ownership are the same, and how they're different, beginning with tenancy in common.
The most common form of concurrent ownership is tenancy in common. It is also the most adaptable form of concurrent ownership. For example, tenants in common may have different ownership interests. Tenant A and Tenant B can each own 25 percent of a home, while Tenant C owns 50 percent. Tenancies in common also may be obtained at different times - Tenant C may have obtained the interest in the property years after Tenant A and Tenant B obtained ownership. And each tenant in common can receive their ownership interest through separate conveyances. Tenant A and Tenant B could both be on the same title, while Tenant C has their own distinct title. The only thing tenants in common completely share is possession.
Joint tenancy, on the other hand, is much more restrictive. Each joint tenant must obtain equal shares of the property, with the same document of ownership, at the same time. These are the 4 unities of joint tenancy. You can remember them with the Acronym TTIP- Time, Title, Interest and Possession.
If any of these four unities are broken, the concurrent ownership is no longer a joint tenancy and ownership reverts to a tenancy in common. As an example, let's say Arthur, Joe and Adrian own a property together as joint tenants. Joe decides property ownership is no longer for him, so he sells his share of the property to Stephen and moves to Panama. Because Stephen doesn't share the unity of “time” with Adrian and Arthur, Stephen does not enter the concurrent ownership as a joint tenant - he is a tenant in common.
There are many similarities between these forms of property ownership. Like, when two or more people own a property as either joint tenants or tenants in common, each individual owns a share of the entire property and has the right to “possess” it. But there are also important differences between joint tenancy and tenancy in common. The biggest difference is the right of survivorship.
The right of survivorship has to do with what happens to the property when one of the owners dies. With joint tenancy, the interest of a deceased owner automatically transfers to the surviving owners because joint tenants have the right of survivorship. If, for example, Carol, Vivian and Stephen own a house as Joint Tenants and Vivian dies, Stephen and Carol each obtain one-half share of the property.
Tenants in common have no right of survivorship. Now, a deceased tenant in common could have a will, or some similar legal instrument, which specifies that their interest in the property is to be divided among the surviving owners. But generally, a deceased tenant in common's interest belongs to their estate.
If we go back to our previous example and Carol, Vivian and Stephen now own a house as Tenants in Common and Vivian dies, Vivian's heirs can acquire her interest in the property - not the surviving owners.
So remember that a property owned by yourself is called ownership in severalty and property owned with someone else is called a concurrent estate. If you hold a concurrent estate as a joint tenant, you must share the unities of Time, Title, Interest and Possession, and you have the right of survivorship. If you hold a concurrent estate as a tenant in common, you share a unity of Possession and have no right of survivorship.
And as a final tip, if you are going to own property with a corporation you would take it as a tenant in common, not a joint tenant, because corporations don't die, they dissolve.