Articles Tagged with joint ownership

6142023-300x300Yes. California law allows a co-owner to take out a mortgage without the other co-owners consent or knowledge. 

Co-owning property with other parties can be quite a responsibility that can be difficult to manage. One particularly stressful aspect of managing property is managing the debt that comes with financing the property. Some parties may even want to take out more debt without letting their fellow co-owners know. If such a debt or encumbrance on the property is taken, it is still enforceable and allowable and can result in the sale of the entire property. 

California Law on Co-Owner Mortgages Without Consent

Underwood-Blog-Images-3-300x300Co-ownership of property brings with it many rights and duties under the law. These rights and duties can vary depending on whether co-owners hold property as tenants in common or joint tenants; these are the two most popular forms of joint ownership in the state. Regardless of the ownership scheme, however, both forms of cotenancy share the same indisputable right: the right of possession. (Bakanauskas v. Urdan (1988) 206 Cal.App.3d 621, 628-630.) 

The right to possession is straightforward. Whether a co-owner holds a 1% or 99% ownership interest, they are nonetheless entitled to occupy the whole of the property if they so choose. (Dabney v. Dabney (2002) 104 Cal.App.4th 379, 382.) Of course, the “right” often does not meet the practicalities of the situation. To that end, co-owners have developed “TIC” agreements, wherein they agree to limit their right to occupy the jointly owned premises. 

TIC agreements, too, seem straightforward enough, but they became the subject of controversy when used with rental properties. Due to California’s skyrocketing housing costs, some co-owners of rental units enacted TICs amongst themselves so that each could have the exclusive right to occupancy (ERO) in particular dwelling units within the rental property. 

Contact Information