House & Apartment

Shared ownership, or co-ownership, means two or more people own the same property. Shared ownership is separate from whether the unit is part of a property association.

Shared ownership can happen in a variety of ways, including:

• Inheriting property together,
• Business partners buying property for commercial use,
• Family members purchasing a vacation home or family residence,
• Real estate investors pooling money to buy property, and
• Through marriage or divorce settlements.

There are three main types of co-ownership for Illinois real estate:

• Tenancy in common,
• Joint tenancy, and
• Tenancy by the entirety.

All of these types involve owning the property alongside at least one other person. They have different legal effects.

Tenancy in common is a form of co-ownership where two or more people share a property, but their ownership shares can be unequal. Tenants in common do not have a right of survivorship. This means that when an owner dies, their share goes to their heirs or whoever is named in their will. 

Each owner can sell, mortgage, or otherwise use their share, as long as it does not affect the whole property.

Joint tenancy is a form of co-ownership where two or more people share equal property ownership and have the right of survivorship. The right of survivorship means that if one owner dies, their share automatically goes to the surviving owner(s).

If one owner sells or transfers their share, that action breaks the joint tenancy for that share, and the new owner holds it as a tenancy in common. However, the joint tenancy between the remaining owners continues.

Joint tenants also have equal rights to possess and use the property. Each is generally responsible for their share of expenses such as property taxes, maintenance, and mortgage payments.

Tenancy by the entirety is a type of co-ownership for married couples who jointly own property as a single entity. Each spouse has an undivided interest in the property, and both of them have to agree for any major decisions or transactions involving the property.  Like joint tenancy, if one spouse dies, the surviving spouse gets title to the entire property.  

Check the deed. It may state clearly how the property is owned. If the deed does not say, look for other language showing how the ownership was created. 

For example, joint tenancy deeds often include phrases like “with right of survivorship.”

The language in deeds can be confusing. For questions about deeds, use Get Legal Help to find a lawyer.

A co-ownership agreement is a written contract between people who share ownership of a property. It clarifies each owner’s rights and responsibilities. This helps prevent disputes. 

Co-ownership agreements are not required by Illinois law. However, they are beneficial in many everyday situations.

Key elements of a co-ownership agreement include:

• Decision-making for improvements: How co-owners approve changes or upgrades to the property.
• Payment responsibilities: Who pays for improvements, repairs, and ongoing expenses, and how costs are shared.
• Ownership of improvements: How upgrades affect property value and whether co-owners are entitled to reimbursement.
• Liability: How debts, legal claims, or injuries on the property are handled.
• Dispute resolution: Methods for resolving disagreements, such as mediation, arbitration, or court action.

A well-drafted co-ownership agreement ensures all owners understand their rights and responsibilities and protects everyone’s interests.

If two or more people co-own a property in Illinois, each owner is generally responsible for paying their share of basic expenses needed to maintain the property. This includes costs like the mortgage, property taxes, insurance, and necessary repairs.

A share refers to the percentage of ownership each person holds. For example, if two people each own 50% of the property, they’re typically expected to split the expenses evenly. If one person owns a larger portion, they may be responsible for more of the costs.

Co-owners also have a duty to notify the others before making repairs (unless it’s an emergency) and give them a chance to contribute or object.

When a rental property has more than one owner, the profits are usually split according to each owner’s percentage of ownership. For example, if two people each own 50% of the property, they are each entitled to 50% of the rental income (after expenses). 

If ownership is unequal, the profits are divided based on the ownership shares in the deed, operating agreement, or other ownership documents.

If one co-owner makes an improvement, it generally becomes part of the property. Co-owners who pay more than their share may be entitled to reimbursement or credit toward their ownership share when the property is sold or partitioned. 

A written co-ownership agreement may:

• Specify how decisions about improvements are handled,
• Set rules for who pays for which improvements, and
• Prevent disputes about value or compensation.

Unless an agreement states otherwise, all co-owners have an equal right to possess the entire property.

A co-owner who is the only person living in the property usually does not have to pay rent to the other owners. They must still pay their share of the mortgage, taxes, utilities, and repairs.

Another co-owner can ask for rent if the person living in the property’s use of the property unfairly prevents other co-owners from using it or earning rental income from it.

Co-owners are generally responsible for their share of expenses, like mortgage payments, taxes, insurance, and necessary repairs. Liability for accidents or injuries on the property can depend on ownership shares, insurance coverage, and who maintains the property. 

A written agreement can clarify who is responsible for debts and legal claims. Work with an insurance agent to make sure insurance is set up correctly and matches how the property is used.

If co-owners can’t agree on what to do with a shared property, any co-owner can file a court action called a “partition.” As long as the co-ownership agreement does not prohibit partition, a judge will then decide how to divide the property fairly. 

Filing a partition action is typically a last resort when other dispute resolution methods have failed. The legal fees can cost more than the property is worth. The court process can take a very long time. For help resolving problems without going to court, contact the Center for Conflict Resolution to find out if free mediation is available.

When a partition case reaches the end, the court may allow one co-owner to buy out the others' interests at the fair market value. A judge can also order one of two types of partition:

• Partition in Kind: The court physically divides the property among the co-owners. Each person receives a separate piece of the property based on their ownership share. If one person gets a portion worth more than their share, the court may order them to pay owelty to the other co-owners (a payment to even out the value).
• Partition by Sale: If dividing the property is not practical, like with a single-family home, the court may order the property to be sold at public auction or on the open market. The proceeds are then divided among the co-owners.