If one owner holds a 60 percent interest and the other holds a 40 percent interest in a parcel of real estate, how do they hold their interests?

Tenants in common is the correct choice in this situation because it refers to a form of property ownership where two or more individuals hold separate and distinct shares of the property. These shares can vary in size, as evidenced by the example provided—one owner having a 60 percent interest while the other has a 40 percent interest.

In a tenancy in common, each owner has the right to use and occupy the entire property, regardless of their percentage of ownership. Furthermore, unlike joint tenants, tenants in common do not have the right of survivorship, which means that if one owner passes away, their share can be inherited by their heirs rather than automatically transferring to the surviving owner.

This structure fosters a flexible ownership dynamic where different parties can contribute varying amounts of investment into a property while still maintaining individual ownership rights. The characterization of the interests as either cooperative, joint tenancy, or community property does not apply here as they impose different rules regarding ownership proportions and rights of survivorship.