Avoid 99%/1% ownership Sometimes I see clients that own property tenants in common with spouses 99/1 shares. One spouse owns 1% and the other owns 99% tenants in common. The only benefit I see with the 99% owner cannot deal with the property without the permission of the other owner - cannot mortgage, sell, discharge mortgage, borrow against etc But there are significant disadvantages. 1. Risk The 1% owner is liable for the whole debt. They are exposing themselves for little reward. This is probably the greatest disadvantage. 2. Tax Returns Extra work putting down 1% of costs and expenses. Hardly worth the bother! 3. Borrowing capacity shot Where the persons want to buy a subsequent property in single names they will each be assessed at the whole debt, not their individual shares, but only taken into account their ownership percentage of the rent received. A double whammy which hurts borrowing capacity. 4. Land tax In some states they will be assessed on land tax as a single unit which could make a difference to whether they pay more land tax or not. Joint owners will be jointly liable for land tax too. 5. No Spousal Loan opportunity A person cannot lend to themselves, but they can lend to a spouse so there are law and tax strategies which are not able to be used where both own the property. - Where one spouse is worried about the other spouse potentially selling or mortgaging a property without their knowledge they can always lodge a caveat to protect their interest - but seek legal advice on the asset protection consequences. Spouses can generally be on loans whether they are on title or not. They can be joint borrowers without affecting the deductibility of interest, or they could be guarantors. The non owner spouse may be necessary to get the loan approved initially but could be removed from the loan down the track if the situation changes.