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Co-ownership Agreement - Real Estate

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Co-ownership Agreement - Real Estate Powered By Docstoc
					This is an agreement wherein two or more persons agree to jointly hold the title to the
property. This agreement includes, but is not limited to, a recital, and important clauses
such as the term of the agreement, occupancy and use, common areas, joint
ownership, joint obligations, rental and other income, relationship of the parties,
disputes, notices, etc. This agreement contains both standard clauses as well as
opportunities for customization to ensure that the understandings of the parties are
properly set forth. This agreement is most useful to individuals or entities buying real
estate together as partners.
                    CO-OWNERSHIP AGREEMENT

This Co-ownership Agreement (the “Agreement”) is made and entered into this
_________ day of _________, 201______ by and between _________ [NAME OF
OWNER 1] of _________[ADDRESS OF OWNER 1], ("Owner 1") and _________
[NAME OF OWNER 2] of __________________[ADDRESS OF OWNER 2]
("Owner 2") (collectively referred to as “Parties”)

                                       RECITALS

       WHEREAS, the Parties are in the process of purchasing certain real property
       located at ________________________________ [PROVIDE ADDRESS OF
       PROPERTY THAT WILL BE THE SUBJECT OF THIS AGREEMENT]
       and more particularly described in the Exhibit A, attached to this agreement and
       incorporated in it by this reference (the “Lands”)

       WHEREAS, the Parties have contributed equally (or in such other proportions as
       may be mutually agreed-upon) such sums of money as may be necessary to
       purchase the said Lands

       WHEREAS, it is the intention of the parties that each shall take title to one half
       interest in the Lands and own, occupy, use, enjoy and dispose of the Lands
       pursuant to the terms, conditions, restrictions and covenants as contained in this
       Agreement.


NOW THEREFORE, in consideration of the mutual covenants, conditions and promises
as set forth in this Agreement and other good and sufficient consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agree as follows:


1.     TERM

The term of this Agreement shall commence on the Effective Date as set out herein and
shall continue indefinitely unless terminated by either party by giving __________ days
notice to the other party.


2.     OCCUPANCY AND USE

Each of the parties to this Agreement shall be entitled to the exclusive use, occupancy
and enjoyment of the portion of Lands as indicated in Exhibit B, attached and
incorporated in this agreement by this reference. Each of the parties shall deposit,
promptly when due, ½ of the total funds to purchase the Lands



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3.     COMMON AREAS

Parties will each have joint rights to use and joint responsibilities to maintain all common
areas (e.g. parking lot, exterior areas, etc.)


4.     JOINT OWNERSHIP

The Parties agree to purchase and will each own joint and equal undivided interests in the
Lands. Such interest shall include all rights and obligations of a party with respect to the
Lands. Such rights (exclusive and nonexclusive) of use, occupancy and enjoyment shall
not be transferable or assignable without the written consent of the other party.


5.      JOINT OBLIGATIONS

The Parties agree to be jointly responsible for all costs that may be incurred in purchasing
and/or maintaining the Lands, including, without limitation, to mortgage payments of
both principle and interest, real estate tax payments, private mortgage insurance (if
applicable), sewer and water use payments, fire and extended insurance coverage,
municipal betterments, electricity, gas and other utilities including heat, and repairs,
maintenance and capital improvements, all legal and Land Titles fees incurred in
purchasing the Lands, all cost of repairs, renovation, restoration, garbage removal,
utilities, taxes and any and all other costs incurred in connection with the Lands. The
Lands shall be kept maintained in first class condition, habitable, clean, reasonably
freshly painted and attractive and in generally good condition.


6.     RENTAL AND OTHER INCOME

All income received from rental of any portion(s) of the Lands will be shared jointly by
the Parties. All such income shall be deposited to and managed in the joint property
account(s)


7.     OPERATION AND USE OF LANDS

All decisions relating to the rental, use, enjoyment, maintenance and repair of the Lands
shall require the consent of both parties. In order to be binding upon the parties, all
decisions relating to the Lands shall be documented in writing, initialed by the parties.


8.     SALE OF THE LANDS




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(a) The Lands may not be sold without prior written consent of the both parties. In the
event that either party wishes to sell, he or she shall first offer to sell his or her interest to
the other party(s) by a written notice stating the proposed terms of sale. The non-selling
party shall have a right of first refusal to acquire the interest of the selling party. The
other party(s) shall within thirty (30) days of the notice of offer to sell elect either (a) to
accept the offer and purchase the offering party’s interest on the terms offered, or (b)
consent to the proposed sale to a third party upon terms offered. The failure of the non-
selling party to respond within such thirty (30) days period shall be deemed an election to
accept the new buyer. The purchase of an interest in Subject Property shall be subject to
the terms and conditions of this Agreement.

(b) The maximum purchase price will be the fair market value of the interest being sold,
as determined by the Parties. If the fair market value cannot be agreed upon by the
Parties, it will be the sum established by an independent appraiser selected by the Parties
or by such other method as is deemed appropriate by the Parties.

(c) In the event that the Property is sold by all parties, the costs incurred by selling (i.e.
payment of mortgage, broker’s commission, escrow, title, etc.) will be deducted from the
purchase price, and the net amount will then be divided between the parties upon their
percentage interest.


9.      ALTERATIONS

Neither party shall make any material alteration or improvement on the Lands without the
written consent of the other party.


10.     ENCUMBRANCES

Neither party to this agreement shall cause or suffer any lien, encumbrance, or charge
(whether voluntary or involuntary) against the Lands without the express written consent
of the other party.


11.     DEFAULT

In the event if either party defaults in timely performance of its obligations and such
failure constitutes a material breach of this Agreement, then, and in that event, the non-
defaulting party shall, in addition to such remedies as may be available at law, be entitled
to exercise the following remedies:

(a). In the case of a financial breach, the non defaulting party may advance such funds as
may be necessary to cure such breach. Any funds so advanced shall be repayable upon
demand, and shall bear an interest at the rate of 10% per annum, and be secured by a lien
upon the interest of the other party in Lands.



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(b). Elect to cause a sale of Lands or the interest of the defaulting party in the Lands in
which event no right of first refusal shall apply.

(c). Elect to purchase the interest of the defaulting party in the Lands for a price equal to
half of the fair market value of Lands at the time of the breach.


12.    JOINT PROPERTY ACCOUNTS

Joint Property Accounts will be maintained by the Parties for holding revenue and paying
costs related to the Lands. This account shall be funded by the parties based upon their
percentage ownership interest in the property. Contributions to the house account shall be
made monthly, in amounts to be determined by the parties. Both parties shall have a
signature authority for checks on the account.


13.    RELATIONSHIP OF PARTIES

This Agreement shall not constitute the parties hereto general partners or joint venturers,
nor constitute any party the agent of the other or, except as provided herein, in any
manner limit any party hereto in carrying on its respective separate business or activities,
nor impose upon any party hereto any fiduciary duty by reason of such party carrying on
its separate business or activity, nor impose upon any party hereto any liability or
obligation except as herein expressly provided.


14.    GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the
State of ______________________.


15.    DISPUTES

For any disputes arising under this agreement, parties agree to first attempt to resolve the
dispute under mediation and then arbitration in the state of __________. In the event of
any dispute hereunder, the party prevailing in such mediation or arbitration shall be
entitled to recover, addition to all other remedies and damages, reasonable attorneys’ fees
incurred in such action. Parties may, as part of these mediation and arbitration processes,
agree to waive all or part of any such award of legal fees; however, such waiver must be
in writing, signed by the waiving party.


16.    NOTICES




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All notices, demands, and requests which may be given or which are required to be given
by either party to the other, hereunder shall be in writing. Such notices shall be deemed
delivered when personally delivered to the address of the party to receive such notice set
forth below or, whether actually received or not, five (5) days after having been deposited
in any post office or mail receptacle regularly maintained by the United States
Government, certified or registered mail, return receipt requested, postage prepaid,
properly addressed as follows:

If to Owner 1, at:

__________________________

__________________________


If to Owner 2, at:

___________________________

___________________________


17.    ENTIRE AGREEMENT

This Agreement sets forth all of the promises, covenants, agreements, conditions and
undertakings between the parties hereto with respect to the subject matter hereof, and
supersedes all prior and contemporaneous agreements and undertakings, inducements or
conditions, express or implied, oral or written.


18.     SEVERABILITY

In the event that any portion of this agreement shall be deemed null and void or
unenforceable by any court of competent jurisdiction, then notwithstanding the same, the
remaining provisions of this Agreement shall be full force and effect.


19.    COUNTERPARTS

This Agreement may be executed in multiple counterparts, each being deemed original
and this one being one of the counterparts.


IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement on the
day and year first above written.




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___________________________
Signature

___________________________
Print Name


___________________________
Signature

___________________________

Print Name
___________________________ __




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                                EXHIBIT A
LANDS




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                                EXHIBIT B




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DOCUMENT INFO
Description: This is an agreement wherein two or more persons agree to jointly hold the title to the property.  This agreement includes, but is not limited to, a recital, and important clauses such as the term of the agreement, occupancy and use, common areas, joint ownership, joint obligations, rental and other income, relationship of the parties, disputes, notices, etc.  This agreement contains both standard clauses as well as opportunities for customization to ensure that the understandings of the parties are properly set forth.  This agreement is most useful to individuals or entities buying real estate together as partners.