"Tenants in common" is a type of property or stock ownership wherein two or more investors co-own an investment without rights of survivorship. In other words, each owner has the right to designate who will inherit his share of the investment when he dies. This is in contrast to "joint tenancy," in which an owner's interest passes to the remaining owner(s) upon death.
- Skill level:
- Moderately Easy
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Gain mutual consent. The first step in selling tenants in common shares is to get all of the owners to agree to the sale. While not mandatory by law, this is the easiest and quickest way to get a stock sold. With verbal or written authorisation, contact your financial representative and inform him of your intention to sell. Check your trade confirmation to ensure that the shares were sold according to your mutual wishes, then wait the required three business days to receive the funds in your account.
Make an equitable distribution of the sales proceeds. In many, if not most, tenants in common situations, the account owners do not own equal shares of the assets. These shares are normally divided by the amount of money put into the investment by each of the partners, but can be divided in any manner that the partners see fit. When the shares are sold, the sales proceeds should be distributed among the partners in accordance with their percentage ownership of the investment.
Get a court order. In some instances, one or more of the tenants in common may not know the other owners and may not agree that the shares should be sold. This can happen, for example, when an original owner dies and passes her share to an heir unknown to the surviving owners. In this instance, the owners wishing to sell the shares can obtain a court order known as a "partition of property," in which case the court will liquidate the shares and make sure that the proceeds are divided proportionately. Upon the sale of the shares, the tenancy in common is dissolved.
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