Divorce and severing joint tenancy

Decisions regarding the family home are usually those which can cause the most conflict and need to be considered in detail during divorce and financial proceedings, but what else do you need to think about?

When you purchase a family home purchased jointly with your spouse, it is likely that you own it is as ‘joint tenants’. This means that, the property is held by both of you and that if one party was to die, the deceased’s share automatically passes to the survivor, irrespective of any financial proceedings that are taking place.

What can you do to change this?

You can decide, during proceedings, to sever this type of tenancy and become ‘tenants in common’. The property would still be in joint names, but by becoming ‘tenants in common’, if either party died, their share would not automatically pass to the other, but would pass according to the terms of their will, or under the rules of intestacy.

If you decide to take to go down this route, it would be advisable to create or update your will, setting out who the share of the property should pass to. If this is not done, under the rules of intestacy it would still pass to your spouse, unless the divorce is final and proceedings have ended.

What are the benefits and risks?

The benefit of severing the tenancy is that if anything were to happen to you prior to the financial issues being resolved and the property dealt with, your spouse would not automatically get your share of the house and you could choose who you would like to receive you share, in accordance with any will created.

The potential risk is that if you sever the tenancy and your spouse dies prior to everything being resolved, his share would not pass automatically to you and would pass to whomever he has nominated in his will.