Glossary
Tenancy in Common
A form of co-ownership in which each owner holds a separate, defined share that can be left to someone else in a will..
Tenancy in common is a form of co-ownership in which two or more people each hold a separate, defined share of a property, and unlike joint tenancy, there is no right of survivorship, so an owner can leave their share to someone else in a will.
How tenancy in common works
Owners in a tenancy in common hold undivided shares in the whole property rather than owning specific rooms or areas. Shares do not have to be equal: two buyers might hold 50/50, while three buyers might hold 60/20/20. The share arrangement is recorded on title through the provincial land registration system, and the mechanics vary from province to province.
Because there is no right of survivorship, an owner's share is an asset of their estate. On death it passes under their will, or under provincial intestacy rules if they die without one. That transfer can involve probate and estate administration costs, and the surviving owners do not automatically receive the share.
Why it matters for a mortgage
A lender secures a mortgage by registering a charge against the property, so every owner on title is normally asked to sign the mortgage documents, and again at renewal or refinance. Even where shares are unequal, co-borrowers are typically jointly and severally liable for the full debt — each can be pursued for the entire balance if the others stop paying. A co-borrower's ownership share does not cap that liability.
There are practical consequences too. Selling or transferring a single share usually requires the lender's consent and may trigger a penalty or a refinance. If one owner wants out, the others are not obliged to buy them out. Lenders may also assess each borrower's income and credit, so one weaker applicant can affect approval and pricing for everyone.
Tenancy in common vs joint tenancy
- Survivorship: a joint tenancy passes automatically to the surviving owners; a tenancy in common does not.
- Shares: joint tenants generally hold equal interests, while tenants in common can hold unequal ones.
- Estate planning: a tenancy in common share can be directed by a will; a joint tenancy interest usually cannot.
- Tax: eligibility for the principal residence exemption depends on use and ownership facts, not only on how title is held.
Because the consequences differ by province and by family situation, buyers commonly obtain independent legal and tax advice before choosing how to hold title.
Frequently asked questions
What is the difference between tenants in common and joint tenants?
Tenants in common each hold a separate share that forms part of their estate and can be left in a will. Joint tenants hold the property together with a right of survivorship, so on death the interest passes automatically to the surviving joint tenants. The two are treated differently for probate, estate planning, and some tax questions.
Can co-owners have unequal shares in a tenancy in common?
Yes. Unlike joint tenancy, a tenancy in common allows unequal interests, such as 70/30 or 60/20/20. The shares are recorded in the provincial land registration system. Note that ownership share and mortgage liability are separate: lenders generally hold all borrowers jointly and severally liable for the full mortgage balance regardless of share size.
Does a tenancy in common avoid probate?
No. Because there is no right of survivorship, a tenancy in common share generally falls into the deceased owner's estate and may be subject to probate and estate administration. Whether probate applies, and what it costs, depends on the province and the size of the estate. Confirm the rules with a lawyer or notary in your province.
Sources
Related terms
- Joint Tenancy — Joint tenancy is co-ownership of property in which the surviving owner or owners automatically inherit the share of an owner who dies, through the right of survivorship.
- Title — Title is the legal ownership of a property, recorded in the provincial land registry that identifies the owner and any registered claims against the land.
- Co-Borrower — A co-borrower is a second person named on a mortgage who is also on title to the property and equally liable for repaying the debt.
- Principal Residence Exemption — A CRA tax rule that lets you exclude all or part of the capital gain on the sale of your main home from taxable income.
- Capital Gains — The profit on selling a property that is not your principal residence, part of which is included in your taxable income.