No, not a Professor from Harry Potter, but a way of altering the type of joint ownership of a property.
It is often asked of us at Paradigm Family Law – “I’ve been served with a notice saying the joint tenancy has been severed, what does it mean?”. It can seem quite daunting, receiving a letter from the Land Registry informing you that you are no longer a ‘joint tenant’ but are now a ‘tenant in common’ of your own house, the house you have always owned in joint names.
Well, the first thing to know is that you remain a joint owner, and yes – still as much responsible for the mortgage as you were before the letter arrived. However, there is a difference between Joint Tenants and Tenants in Common and in this post we will hopefully illuminate you as to the differences between each one.
Severing the Joint Tenancy
If you or your spouse/partner own property in joint names, it will usually be held as Joint Tenants, in which case the right of survivorship will apply. The type of ownership affects what you can do with the property if your relationship with a joint owner breaks down, or if one owner dies.
If you are a Joint Tenant, this means that on the death of one tenant, his or her share automatically passes to the surviving tenant.
If you do not wish this to happen, then the Joint Tenancy must be severed to create a Tenancy in Common. This is a fairly simple process and, once done, the right of survivorship no longer applies, such that on the death of one tenant, his or her share does not automatically pass to the surviving tenant, but according to his or her valid Will or the rules of intestacy in the event that there is no valid Will.
As Joint Tenants (sometimes called ‘Beneficial Joint Tenants’):
you have equal rights to the whole property
the property automatically goes to the other owners if you die
you can’t pass on your ownership of the property in your will
Tenants in Common
As Tenants in Common:
you can own different shares of the property
the property doesn’t automatically go to the other owners if you die
you can pass on your share of the property in your will
How do I change my type of ownership
There are two options:
You can change from Joint Tenants to Tenants in Common – usually in circumstances where there are divorce proceedings or a separation and you would rather leave your share of the house to someone other than your spouse or civil partner.
Change from Tenants in Common to Joint Tenants – usually in the opposite scenario where you are now married and want equal rights for each of you to the property.
Changing from Joint Tenants to Tenants in Common
This is known as ‘Severing the Joint Tenancy’. It requires service of a written notice of change – the ‘severance’. It can be done without the other owner’s cooperation or agreement. It is recorded at the Land Registry, and the other owner will know it has been done but only ‘after the event’ so to speak.
It can also be done by agreement of the owners, and a slightly different procedure is followed, but the result is the same.
Changing from Tenants in Common to Joint Tenants
You need the agreement of the owners for this to happen. It will require a trust deed to be prepared usually by a qualified solicitor or conveyancer and setting out that the new terms of ownership are for all the joint owners to own the property as beneficial Joint Tenants.
If you are served with a Notice of Severance, don’t worry. It does not mean that you are no longer the owner of the property, or that you have to meet all of the mortgage payments. It simply reflects a change in the way the property passes in the event of the death of one of the owners.
It is important though that you review your Will or have one prepared so as to protect your share of the house for your next of kin.
It will not affect any divorce settlement prospects – the court has the power to regulate ownership of matrimonial property whether you are Joint Tenants or Tenants in Common.
But don’t delay – if you are thinking of severing the Joint Tenancy of your home but have no Will in place it is essential that you have an up-to-date, valid Will.
Also please be aware that, in any event, divorce affects any existing Will and invalidates any reference to a husband or wife and thereby a new Will needs to be drawn up once divorced.
If you have received a Notice of Severance, or you would like to discuss changing the ownership of the matrimonial home contact Paradigm Family Law on 0845 6020422 or email us at [email protected] and James or Frank can help with the formalities.