What is proportional interest?

Answer 1

A proportional (or proportionate) interest in land means the person has an identifiable interest in real property that is less than a 100% interest. For example, three sisters who inherit the family homestead would each own a one-third proportional interest as tenants in common. That means each of the sisters has the right to the use and possession of the whole property. If one dies her family would inherit a one-third interest. If none died and the property was sold, each sister would receive one-third of the net proceeds.

For a different type of situation suppose two people are the grantees in a deed. If the deed does not specify how the interest will be split then each grantee has a one-half proportional interest even if the other grantee paid the purchase price.

Any other arrangement would need to be clearly expressed in the deed. For example, suppose two friends purchased a two family dwelling for investment purposes and one paid one-fourth of the purchase price and the other paid three-fourths. The deed could be drafted to convey a one-quarter interest to one and a three-quarter interest to the other. Those proportional interests recited in the deed would prevail if the property was sold. If one or both grantees died their proportional interest would pass to their heirs.