ContractsCounsel Logo
Home Types of Contracts Tenancy in Common Agreement

Tenancy in Common Agreement

Jump to Section

A tenancy in common agreement is a contract focused upon explaining the ownership rights and duties of co-owners of the negotiated property between all parties. This agreement introduces the arrangement by underlining the important terms and circumstances that govern the tenancy. A tenancy in common arrangement imposes joint and several duties on renters, but it is suitable for situations or persons who want to hold property jointly with their partners but want to leave their portion to someone other than the co-tenant. Let us know further about it in this blog below.

Benefits of Tenancy in Common Agreements

Tenancy in common (TIC) has various advantages for anyone who selects this property ownership. Here are some vital benefits of a shared tenancy:

  • Permitting Shared Property Ownership: TIC permits numerous people to co-own a property. Individuals may be able to invest in real estate or own property that they would not be able to afford otherwise. Property ownership may be made more accessible and reasonable by sharing the expenses and responsibilities.
  • Allowing Ownership Percentage Flexibility: Unlike other types of shared ownership, such as joint tenancy, TIC allows for uneven ownership percentages. Each co-owner can have a separate ownership share depending on their financial contributions, participant agreement, or other criteria. This adaptability enables a more customized ownership structure that reflects the choices and contributions of the co-owners.
  • Facilitating Individual Control: Each co-owner in a TIC agreement has the right to own and utilize the entire property, regardless of ownership proportion. Individual control allows co-owners to make choices about property usage, management, and upgrades, subject to any agreed-upon constraints in the TIC agreement. It provides for liberty and personalization of property used within the framework of shared ownership.
  • Providing Investment Opportunities: TIC ownership allows co-owners to invest in real estate. This might be useful for those who wish to diversify their investment portfolios or enter the real estate market without bearing the complete financial load. Co-owning a property through TIC provides for shared risks, expenditures, and possible rewards on investment.
  • Including Estate Planning Flexibility: There is no automatic right of survivorship in a TIC agreement. This implies that if a co-owner dies, their ownership stake does not immediately pass to the surviving co-owners. Instead, it is included in their estate and divided under their will or relevant inheritance rules. This flexibility can be advantageous for estate planning since it allows co-owners to transfer their ownership stake after death.
  • Recognizing Potential for Better Profits: TIC ownership recognizes the potential for better profits compared to other investment alternatives. Co-owners may profit from property appreciation, rental revenue, or other financial rewards related to the property by combining resources and investing in real estate. This potential for higher returns can attract investors looking for long-term financial growth.

Essential Tips to Draft Tenancy in Common Agreements

Below are essential tips that should be considered while drafting a common agreement.

  • Seeking Professional Advice: It is strongly advised to seek the advice of a real estate attorney specializing in TIC agreements. They may offer legal advice, guarantee compliance with local rules and regulations, and assist in tailoring the agreement to your unique needs.
  • Defining Shares: Clearly define each co-owner’s ownership percentages or shares. This might be based on monetary contributions, parties' agreements, or other causes.
  • Assigning Financial Duties: Clearly define each co-owner’s financial duties, such as contributions to mortgage payments, property taxes, insurance premiums, and maintenance charges. Establish processes for reimbursing or recording payments and specify how these expenditures will be shared among the co-owners.
  • Identifying Decision-Making Process: Within the TIC agreement, identify the decision-making procedures. Determine whether choices will be decided by unanimous vote, majority vote, or ownership percentages. Consider prospective circumstances requiring decisions like property enhancements, renovations, or substantial repairs.
  • Determining Limitations: Discuss and agree on property usage standards, including any limits or prohibitions on activities, changes, or leasing. To maintain unity and minimize problems, ensure that all co-owners know and agree to these usage standards.
  • Addressing Changes and Amendments: Anticipate and address any ownership changes in the agreement. Consider including rules for the sale or transfer of ownership interests and any first-refusal rights among co-owners or processes for valuing ownership interests. Establish procedures for making amendments and ensure that all co-owners properly document and agree upon any changes to the agreement.
Meet some lawyers on our platform

Steven S.

21 projects on CC
CC verified
View Profile

Ryenne S.

670 projects on CC
CC verified
View Profile

Sarah S.

35 projects on CC
CC verified
View Profile

Rene H.

37 projects on CC
CC verified
View Profile

Steps for Dissolution of Tenancy in Common Agreements

The tenancy in common (TIC) agreement dissolves when co-owners discontinue their shared property ownership. Here's an outline of the steps of terminating a TIC agreement:

  1. Confirm Mutual Agreement. Typically, the dissolution of a TIC agreement requires the joint consent of all co-owners. All parties must agree on the decision to terminate the TIC agreement.
  2. Examine the TIC Agreement. The co-owners should thoroughly analyze the first TIC agreement. The agreement may include conditions and processes for terminating the arrangement, such as the distribution of funds from the sale of the property. It is important to adhere to the norms and conditions mentioned in the agreement.
  3. Sell the Property. Once the appraisal has been completed, the co-owners can sell the property. This might include putting it on the market, hiring a real estate agent, or finding a buyer on your own. The selling procedure should adhere to the legal and regulatory requirements of the jurisdiction in which the property is located.
  4. Conduct Valuation of Ownership Interests. If the co-owners decide to sell the property and split the profits, the value of each co-owner’s ownership interest must be calculated. This can be performed through a certified expert evaluation that considers the property's fair market worth and each co-owner ownership part.
  5. Settle any Outstanding Obligation. Before finalizing the termination of the TIC agreement, the co-owners shall clear any outstanding financial obligations relating to the property. This may involve paying off mortgages, removing liens, settling any outstanding property tax or insurance issues, and handling any other financial obligations related to the property.
  6. Seek Legal Advice. It is recommended that you speak with a real estate attorney throughout the process of terminating a TIC agreement. They may give legal advice, examine the TIC agreement, aid with property assessment, ensure compliance with applicable regulations, and assist in navigating any potential problems or conflicts that may emerge throughout the dissolution process.

Key Terms for Tenancy in Common Agreements

A tenancy in common agreement describes the rights and duties of co-owners who own a property in their whole. Here are key terms and major words in such contracts:

  • Co-Owners: The co-owners in the agreement who hold the property together.
  • Undivided Interest: Each co-owner is part of property ownership, with no physical split.
  • Ownership Percentages: The particular proportions or percentages allocated to each co-owner to indicate their interests in the property.
  • Survivorship Rights: Unlike joint tenancy, tenancy in common does not include an automatic right to survivorship. When a co-owner dies, their share is distributed to their estate or chosen beneficiaries rather than the surviving co-owners.
  • Transferability: Each co-owner has the right to transfer, sell, or mortgage their ownership stake without the approval of other co-owners.
  • Partition: The provision that permits co-owners to seek a partition, which can include physically splitting or selling the property and dividing the revenues among the co-owners based on their ownership percentages.

Final Thoughts on Tenancy in Common Agreements

A tenancy in common agreement is a contract specifying co-owners' rights and duties. It encourages clarity, collaboration, and successful administration of shared property. The agreement helps to prevent disagreements and guarantees a happy living arrangement by covering essential factors such as property usage, expenditures, and dispute resolution. Seeking legal advice during the development or signing of a tenancy in common agreement is vital to guarantee its legitimacy and compliance with applicable laws.

If you want free pricing proposals from vetted lawyers that are 60% less than typical law firms, click here to get started. By comparing multiple proposals for free, you can save the time and stress of finding a quality lawyer for your business needs.


ContractsCounsel is not a law firm, and this post should not be considered and does not contain legal advice. To ensure the information and advice in this post are correct, sufficient, and appropriate for your situation, please consult a licensed attorney. Also, using or accessing ContractsCounsel's site does not create an attorney-client relationship between you and ContractsCounsel.


How ContractsCounsel Works
Hiring a lawyer on ContractsCounsel is easy, transparent and affordable.
1. Post a Free Project
Complete our 4-step process to provide info on what you need done.
2. Get Bids to Review
Receive flat-fee bids from lawyers in our marketplace to compare.
3. Start Your Project
Securely pay to start working with the lawyer you select.

Meet some of our Tenancy in Common Agreement Lawyers

Michael T. on ContractsCounsel
View Michael
5.0 (1)
Member Since:
June 13, 2022

Michael T.

Lawyer
Free Consultation
Fairfax, Virginia
34 Yrs Experience
Licensed in DC, MD, VA
College of William and Mary

I have been in practice since 1990 and practice in D.C., Maryland, and Virginia. I am an experienced litigator and look forward to resolving your legal questions as efficiently as possible.

Richard G. on ContractsCounsel
View Richard
5.0 (1)
Member Since:
June 20, 2022

Richard G.

Attorney
Free Consultation
Greensboro, NC
4 Yrs Experience
Licensed in NC
University of Elon School of Law

Hello! I am an Iowa native trying to bring some Midwest problem-solving to southern civil law. I thoroughly enjoy getting to know the individuals and businesses I assist. I practice estate planning and business formation and, with my litigation experience in mind, I help clients plan to ensure they and their interests are protected in the future.

Danielle G. on ContractsCounsel
View Danielle
5.0 (3)
Member Since:
July 12, 2022

Danielle G.

Attorney and Founder at Danielle D. Giovannone Law Office
Free Consultation
Schenectady, NY
17 Yrs Experience
Licensed in NY
Fordham University School of Law

Danielle Giovannone is the principal of Danielle D. Giovannone Law Office. In her experience, Danielle has found that many business do not require in-house legal counsel, but still need outside counsel that knows their business just as well as in-house counsel. This need inspired Danielle to start her firm. Before starting her firm, Danielle served as Contracts Counsel at Siena College and as an attorney at the New York City Department of Education, Office of the General Counsel. At the NYCDOE, she served as lead counsel negotiating and drafting large-scale commercial agreements, including contracts with major technology firms on behalf of the school district. Prior to the NYCDOE, Danielle worked as an associate at a small corporate and securities law firm, where she gained hands-on experience right out of law school. Danielle has provided legal and policy advice on intellectual property and data privacy matters, as well as corporate law, formation and compliance, employer liability, insurance, regulatory matters, general municipal matters and non-profit issues. Danielle holds a J.D. from Fordham University School of Law and a B.S. from Cornell University. She is active in her Capital District community providing pro bono services to the Legal Project, and has served as Co-Chair to the Niskayuna Co-op Nursery School and Vice President of Services to the Craig Elementary School Parent Teacher Organization. Danielle is a member of the New York State Bar Association.

Michael J. on ContractsCounsel
View Michael
5.0 (1)
Member Since:
July 14, 2022

Michael J.

Partner
Free Consultation
Warren, New Jersey
16 Yrs Experience
Licensed in NJ, NY
New York Law School

Combining extensive experience in litigation and as general counsel for a real estate and private equity company, I provide ongoing guidance and support to clients on a variety of transactional matters, including business formation, partnership agreements, corporate agreements, commercial and residential leasing, and employment issues.

Anand A. on ContractsCounsel
View Anand
5.0 (39)
Member Since:
July 17, 2022

Anand A.

Counsel
Free Consultation
Philadelphia, PA
10 Yrs Experience
Licensed in NJ, PA
Rutgers University School of Law

Anand is an entrepreneur and attorney with a wide-ranging background. In his legal capacity, Anand has represented parties in (i) commercial finance, (ii) corporate, and (iii) real estate matters throughout the country, including New Jersey, Pennsylvania, Delaware, Arizona, and Georgia. He is well-versed in business formation and management, reviewing and negotiating contracts, advising clients on financing strategy, and various other arenas in which individuals and businesses commonly find themselves. As an entrepreneur, Anand is involved in the hospitality industry and commercial real estate. His approach to the legal practice is to treat clients fairly and provide the highest quality representation possible. Anand received his law degree from Rutgers University School of Law in 2013 and his Bachelor of Business Administration from Pace University, Lubin School of Business in 2007.

Christopher M. on ContractsCounsel
View Christopher
4.9 (8)
Member Since:
August 16, 2022
AHAJI A. on ContractsCounsel
View AHAJI
Member Since:
July 8, 2022

AHAJI A.

Attorney
Free Consultation
Houston, TX
25 Yrs Experience
Licensed in NC, TX
Indiana University - IUPUI

Ahaji Amos, PLLC is a Houston-based intellectual property and civil litigation firm servicing clients throughout the U.S.

Find the best lawyer for your project

Browse Lawyers Now

Quick, user friendly and one of the better ways I've come across to get ahold of lawyers willing to take new clients.

View Trustpilot Review

How It Works

Post Your Project

Get Free Bids to Compare

Hire Your Lawyer

Real Estate lawyers by top cities
See All Real Estate Lawyers
Tenancy in Common Agreement lawyers by city
See All Tenancy in Common Agreement Lawyers

Contracts Counsel was incredibly helpful and easy to use. I submitted a project for a lawyer's help within a day I had received over 6 proposals from qualified lawyers. I submitted a bid that works best for my business and we went forward with the project.

View Trustpilot Review

I never knew how difficult it was to obtain representation or a lawyer, and ContractsCounsel was EXACTLY the type of service I was hoping for when I was in a pinch. Working with their service was efficient, effective and made me feel in control. Thank you so much and should I ever need attorney services down the road, I'll certainly be a repeat customer.

View Trustpilot Review

I got 5 bids within 24h of posting my project. I choose the person who provided the most detailed and relevant intro letter, highlighting their experience relevant to my project. I am very satisfied with the outcome and quality of the two agreements that were produced, they actually far exceed my expectations.

View Trustpilot Review

How It Works

Post Your Project

Get Free Bids to Compare

Hire Your Lawyer

Want to speak to someone?

Get in touch below and we will schedule a time to connect!

Request a call

Find lawyers and attorneys by city