Considering all of the price increases, purchasing a home may appear out of reach, especially for young home buyers. However, if you are determined to invest in real estate, there are a variety of options available to help you beat the market price and high credit score requirements, such as co-buying or a co-ownership agreement.
Property co-ownership means that more than one person has an ownership interest in a piece of real estate . Tenancy in common, joint ownership, community property, and tenancy by the entirety are all examples of co-ownership.
In the Philippines, co-ownership is also referred to as co-buying. This happens when two or more people buy a house and decide to split ownership. In a co-buying arrangement, the property co-owners could be a couple, a family, close friends, a group of people or businesses, or a combination of both. Being an owner is the same as being a co-owner, with the exception that the co-share buyer is proportional to his or her interest.
When you become a co-owner of a property, you form a legal relationship. This is governed by a co-ownership agreement signed by you and your joint partners.
Tenancy in Common and Joint Tenancy are the two most common types of co-ownership agreements.
Tenancy in Common allows two or more parties to own a financial share of a property and transfer their interests independently. This provides a more flexible form of property co-ownership, allowing parties to own land in equal or unequal shares.
Couples have traditionally used joint tenancy. As a couple, these tenants own the entire property. This type of co-ownership includes survivorship rights, which means that if the other co-owner dies, the surviving tenant inherits the entire property.
Co-ownership, like other purchasing agreements, has advantages and disadvantages. Here are the benefits and drawbacks of a co-owned property arrangement:
The rights of a co-owner are essentially the same as the rights of an owner. The only restriction is that a co-owner must respect the rights of his co-owners. A co-owner must use the thing owned in common as long as it does not harm the co-interest ownership or prevent the other co-owners from using it. The underlying logic is that until a division is made, the respective share of each cannot be determined, and each co-owner exercises joint ownership of the property owned in common in addition to his use and enjoyment of the said property.
An undivided co-ownership owner of the co-owned property is absolute. He is free to sell, mortgage, alienate, or otherwise dispose of the property. He might even have someone else join him in enjoying it. But once more, the restriction only applies if it doesn’t harm the co-interests ownership or prevent the other co-owners from using it.
An undivided co-ownership owner of the co-owned property is absolute. He is free to sell, mortgage, alienate, or otherwise dispose of the property. He might even have someone else join him in enjoying it. But once more, the restriction only applies if it doesn’t harm the co-interests ownership or prevent the other co-owners from using it.
Co-owning could appear to be an overwhelming idea given all the variables involved. Conflict can be avoided in some situations, though. You need a written contract describing the duties and obligations of each owner.
These records should be drafted by a real estate attorney and include the following information:
As long as you establish clear guidelines with your co-buyers and seek legal advice, co-buying doesn’t have to be as complicated as it might sound. In order to afford their preferred property, more young homebuyers choose co-buying agreements as the cost of homes continues to grow.
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