United States · 9 min read · Laddered Editorial · 21 Jul 2026

Tenancy in Common (TIC) Agreements: What to Include, Clause by Clause

A TIC agreement template gives you the headings. This is the substance under them — the clauses that decide unequal shares, missed payments, exits and death, and what goes wrong when they're missing.

• legal
• agreements
• us
• co-ownership

This article is general information only and is not legal, financial, tax, or property advice. Consider advice from a qualified professional for your circumstances.

The template isn't the hard part

Search "tenancy in common agreement template" and you'll find a dozen sites happy to sell or give you one: a few pages of headings, some blanks for names and percentages, a signature block. The download is not the problem. The problem is that a TIC agreement is a set of decisions, and a template can't make them for you. Co-owners who fill in the blanks without having the conversations end up with a signed document and the same unresolved questions.

This guide walks the clauses that matter, what each one actually decides, and where co-owners get burned when one is missing. (For the broader picture of co-ownership agreements generally, start here.)

First, what tenancy in common is

Tenancy in common (TIC) is the way unrelated co-owners usually hold title in the US. Each owner holds a defined, transferable share — 50/50, 60/40, whatever you agree — and can leave that share to their heirs. Compare joint tenancy, where owners hold equally and a deceased owner's interest passes automatically to the survivors regardless of any will. For friends, siblings and unmarried partners, TIC is almost always the right vehicle precisely because the shares can be unequal and inheritable.

The part that gets missed: the deed only records the percentages. Everything else — who pays what, who decides what, how someone leaves — lives in the TIC agreement, or nowhere.

Ownership shares (especially unequal ones)

If one of you put in 70% of the down payment, say so on the deed and in the agreement, and say what the percentages mean. Do they track the down payment only? Do they shift if one person pays more of the mortgage over time? Is sweat equity counted? (How to structure unequal ownership is its own topic.) The agreement should also state what happens to shares if someone funds a major improvement — credited at sale, adjusted immediately, or absorbed.

The money clauses

• Mortgage and carrying costs. Who pays what share of the mortgage, taxes, insurance, HOA and utilities — by ownership percentage, equally, or some other split. Put the actual numbers in.
• A shared account and a reserve. Most functional TICs run costs through a joint account each owner funds monthly, with a reserve built up for repairs, because roofs and furnaces don't wait for everyone's payday to line up.
• Records. Who paid what decides tax deductions and sale proceeds later, so the agreement should require keeping a shared ledger. (The tax side works like this.)

The default clause: what happens when someone stops paying

This is the clause the templates skimp on and the one you'll want most. On a shared mortgage, the bank doesn't care about your percentages — everyone on the loan is liable for all of it. So the agreement needs an internal answer: how long a co-owner can run behind, whether the others' covering payments become a loan against the defaulter's share (usually with interest), and at what point sustained default triggers a forced buyout of the defaulting owner. Without this, one person's bad year becomes everyone's credit problem.

Decisions and deadlocks

List which decisions need everyone (sell, refinance, renovate above a threshold, bring in a tenant) and which can be made by majority or by one owner alone. Then decide how ties break — mediation first, then arbitration or a buy-sell mechanism. A 50/50 TIC with no deadlock clause has no way to resolve a genuine impasse except court.

Exit: the clause that decides whether this ends well

Every TIC agreement needs a full exit mechanism, agreed while everyone still likes each other:

• Right of first refusal. A departing owner must offer their share to the others before selling outside.
• Valuation. How the share gets priced — an independent appraisal, an average of two, or an agreed formula.
• The math. Buyout = net equity times share. A house worth $500,000 with $300,000 owing has $200,000 of equity, so a 30% owner exits at $60,000. Run your own numbers.
• Funding and timing. How long the remaining owners get to refinance and pay, and what happens if they can't.

Absent an agreement, any tenant in common can force the issue through a partition action — a court-ordered sale, with legal fees taken out of everyone's proceeds. The exit clause exists so nobody ever needs that.

Death, and the co-owner you didn't choose

A TIC share passes by will. That means without planning, you can end up co-owning with your co-owner's heirs — or their surprised spouse. Good agreements give the surviving owners an option to buy the deceased owner's share from the estate at the agreement's valuation method, on a defined timeline.

The checklist

• Names, shares, and how shares can change
• Cost splits, the shared account, the reserve, the ledger
• Decision thresholds and the deadlock-breaker
• Default: grace period, interest on covered payments, forced-buyout trigger
• Exit: right of first refusal, valuation method, funding timeline
• Death: estate buyout option and timeline
• Dispute resolution: mediation, then arbitration
• Insurance requirements and who holds the policy
• Signatures, and a lawyer's review before them

Where a lawyer fits (and where Laddered does)

A TIC agreement is a real contract — in some cities with established TIC markets (San Francisco most famously), it's also what lenders expect to see. Have a real estate attorney draft or at least review yours; the few hundred dollars is minor against a partition suit. What a lawyer won't do is run the agreement afterward: track that everyone's actually paying their share, log the expenses, keep the running balances. That's the layer Laddered handles — you agree the shares, the splits and the exit rules, and the app keeps the ledger that proves them for as long as you own together.