You have found yourself a great house. It meets all your requirements, it has all that you dreamed of, but it is beyond your means. What do you do?

In comes the concept of joint or co-ownership. By opting for joint ownership, you and a few others pool in their resources/funds to purchase the property. After purchasing the property, you and your partners have a joint or united ownership interest in the purchased property and are called joint or co-owners of the property. Joint ownership comes with a common interest in the property and joint liability also.

There are different types of co-ownership like joint tenancy, tenancy in common, tenancy by entirety, etc. Legal Provisions related to joint ownership are found in the Transfer of Property Act, 1882. This article seeks to explain certain concepts regarding joint ownership and answer some questions on the topic.

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How do you enter into joint ownership?

There are different types of joint or co-ownership like:

  • Joint Tenancy: Two or more people can enter into a joint tenancy by agreement or will i.e. by mutual agreement between two or more people or by the testamentary wishes of the deceased. This type of joint ownership is accompanied by the right of survivorship i.e. after the death of a co-owner, his/her share or rights vest in the surviving co-owner/s.
  • Tenancy in common: When the nature of co-ownership in property is not defined, it is known as a tenancy in common. This may also involve execution through an agreement.
  • Tenancy by the entirety: In this type of co-ownership, the co-owners are required to a legally married couple. Transferring a share of the property to a third party or stranger is forbidden. A spouse can transfer his/her share only to the other spouse. In the event of a divorce, this type of tenancy converts to a tenancy in common.

You can choose the type of co-ownership that meets your requirements.

Is it a bad idea to buy a house with your friend?

A natural person can choose to purchase a house in joint ownership with anyone s/he wants. This may be an unrelated third party or with a member of your kith and kin.

  • Joint ownership in a residential property can be established between two or more people.
  • It is your personal choice to enter into joint ownership with the person you choose.
  • If you and your friend decide to purchase residential property, you need to discuss your respective contribution towards the purchase value of the property.
  • There are things you and your friend will have to go through together like conducting a title check, home appraisal, checking for any outstanding loans on the property, etc.
  • After following due diligence, you can mutually discuss and decide on the terms and conditions of the joint ownership agreement to provide for different situations and variations.
  • Set down the ground rules for usage, enjoyment, transfer and finally the disposal of the property in the agreement.

What do you do if you share a property with another family member?

Sharing a property with a family member is no different than sharing a property with a friend or third party.

  • However, there are types of co-ownership like tenancy by the entirety, where the co-owners of the property need to be a legally married couple. In such a case, transfer of the share of property or interest therein is not possible to stranger third parties. It can be conveyed only to the other spouse.
  • In the case of Hindu Undivided Family (HUF), a joint family occupies an undivided estate. By law, the rights and duties of the coparceners (members of the HUF) are outlined.
  • If you are sharing the property with a family member, do not go lax on the paperwork or documentation just because your co-owner is a family member. It may create problems in the future for both of you.
  • Incorporate stipulations regarding usage, enjoyment, transfer and final disposal of property in clear, unambiguous language in the agreement after mutual discussion.

Does joint mortgage mean joint ownership?

If two or more people decide to avail a joint home loan to purchase a house to spread the liability among themselves, they are essentially sharing liability on the property.

  • However, it is the name or names on the title deed that matter.
  • The joint mortgage does not indicate joint ownership. It indicates joint liability.
  • The title deed’s name clause determines the status of the parties in the arrangement.

How can I benefit from taking a joint loan?

 Once you have zeroed in on your prospective home and conducted a little due diligence, there are chances that you may find the value of the house beyond your means.

  • Where a home loan appears a good alternative to arrange the funds, you may find that a joint loan proves better.
  • A co-applicant who is self-employed or salaried may improve your eligibility for the loan.
  • If your wife is a co-applicant, some banks give loans at lower interest rates to women as co-applicants.
  • A joint loan will help spread out the liability over multiple people and ensure shared loan repayment.
  • In a joint loan, both the co-applicants are entitled to tax benefits as opposed to one person applying for a home loan.

There are downsides to availing a joint loan if you have a poor credit rating or you are already repaying a loan where your eligibility is maxed out or if you find yourself purchasing a house purely for investment purposes etc.

You should remember that it is up to you to decide the way to raise the funds for purchasing your share in joint ownership. You are free to avail a loan for purchasing your share in the property or paying cash for it.


Joint ownership is a type of ownership that can be advantageous for people who want to own a residential property that falls beyond their means. You can share the property with a friend or family member where the arrangement may be beneficial both for you and them. Before making a joint co-ownership agreement, discuss and clearly outline the rights, interests, obligations and liabilities of the parties in the agreement.

Property details and details regarding the respective contributions of the co-owners should also be mentioned. In clear, unambiguous terms, the proprietary right regarding usage enjoyment, transfer and disposal of the property must be outlined. Make sure that your respective details on the title deed of the property reflect the arrangement between you and your co-owner/s. A joint loan for purchasing property does not mean joint ownership.

Before availing a joint loan for purchasing the property, conduct the required due diligence, compare the lending options available to you and avail of the loan with terms that are the most beneficial to you and your fellow co-owner/s.