Most of the people, especially couples prefer joint ownership on a property for its many benefits. The most important benefits of joint property ownership are
- Increased loan eligibility
- income tax benefits
- Payment flexibility
- Hassle-free property transfer
But the problems between co-owners of a property for example, the divorce between a couple has major ramifications on the property ownership.
Financial Obligations
In the case of joint property ownership, both the partners ie the co-borowers of the home loan pay the loan amount. For a bank or any other financial institutions, it does not matter who is repaying the loan amount. Once the couple makes defaults in the payment, the bank will take recovery process against both the co-borrowers.
Property settlement
generally, the property is divided on the basis of individual equity share. The options available for property settlement are
1. Selling the property
The owners can sell the property and share the process based on the individual equity share.
2. Retaining the property
If one of the owners plan to retain the property in his name he can buy the other's share according to the current market value.
3. Continue to hold it under joint ownership
The partners can retain the property under joint ownership to avail the tax benefits, if both have no issues on it.
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