Do Not Risk Your Real Estate Property with Verbal Agreements

Co-owning real estate seems simple, whether you bought the property with a friend, relative, spouse or inherited it. You share ownership, responsibilities and, of course, the potential value of the property. But even if you completely trust your co-owner, you should never rely only on a verbal agreement. Because when misunderstandings and disputes arise, words alone cannot protect you in court.

Why you need a Tenancy in Common (TIC) agreement

A TIC agreement is a written contract that clearly defines each owner’s rights and responsibilities. New York City property values are high, which makes real estate transactions complex, so a TIC agreement is necessary to protect everyone involved.

Here are some of the things that a TIC agreement can cover:

• Ownership percentages: This clearly states what portion of the property each co-owner holds.
• Financial responsibilities: This outlines how owners share expenses like mortgage payments, property taxes, insurance and maintenance costs.
• Decision-making rules: This sets guidelines on how co-owners make major decisions.
• Buyout provisions: This section lays out a plan for when one owner wants to sell their share.
• Dispute resolution: This part establishes a process for handling disagreements to avoid costly litigation.

It is never too late to draft a TIC agreement. It benefits everyone involved and provides protection for all co-owners.

What are the other advantages of having a TIC agreement?

Apart from protecting every owner’s investment, a TIC agreement provides a clear framework for any transition that may happen in the future. This includes death, disability or permanent relocation. A TIC agreement guarantees that the property remains protected from any unexpected event.

Why you need to hire a lawyer

A verbal agreement is never enough in a competitive and high-stakes real estate market. You need a written TIC agreement to protect your investment and your relationships with your co-owners. If you want to co-own a property in New York City, speak with a real estate attorney who can draft a comprehensive TIC agreement to safeguard your best interests.