Certified Residential Appraiser Practice Exam

What type of ownership involves two or more individuals holding title on the same property with distinct shares?

1. Joint Tenancy

2. Tenancy in Entirety

3. Individual Ownership

4. Tenant in Common

The correct answer is: Tenant in Common

The correct choice indicates a form of property ownership known as "Tenant in Common." In this arrangement, two or more individuals hold legal title to the same property, but they each possess distinct shares, which may or may not be equal. This means that one owner can have a larger interest in the property than another; for instance, one owner could hold a 70% share while another might hold 30%. A significant feature of tenancy in common is that each co-owner is free to sell their share independently without needing consent from the other owners. Additionally, if one co-owner passes away, their share does not automatically transfer to the other owners but instead goes to their heirs, which underscores the unique nature of this ownership structure. In contrast, joint tenancy involves co-owners holding an equal share of the property with rights of survivorship, meaning that upon the death of one owner, their share automatically passes to the surviving owner(s). Tenancy by the entirety is a form of ownership specifically reserved for married couples, featuring rights of survivorship and requiring both spouses' consent for the sale or encumbrance of the property. Lastly, individual ownership pertains to a single person owning a property outright, without shared interests. Therefore, tenant in common is the