Harry is 65 years old and is recently retired. He would like to purchase a cottage to enjoy during retirement. He expects to leave his cottage to his only adult child named Noemi. As a result of this, he decides to purchase the cottage with her. How should the cottage be owned?
- Single ownership with an up-to-date Will naming Noemi as the recipient of the cottage
- Joint tenancy
- Tenants in common
- Either joint tenancy or tenants in common
Solution: The main learning concept is the joint tenancy vs tenants in common concept. When a property is owned in joint tenancy, the share ownership of the first person (when they pass away) transfers to the other owner. In this case when Harry passes away his share would go to Noemi. When two or more individuals own a property tenants in common, their ownership passes onto their heirs (usually specified in a Will) and not to the other owners of the asset. The answer is b.