Buying a House Together Before Marriage? Protect Your Interests in Case of a Breakup
The number of unmarried couples buying homes together is on the rise. In fact, according to a recent report by the National Association of Realtors, unmarried couples make up 18% of all first-time homebuyers.
While this is a positive trend, it’s important for unmarried couples to take steps to protect themselves in the event of a split. After all, if the relationship ends, both parties could end up losing their investment in the home.
Here are a few things unmarried couples can do to protect themselves:
Get a Cohabitation Agreement.
A cohabitation agreement is a legal document that outlines the rights and responsibilities of each partner in the event of a split. It should include details such as how the property will be divided, who will be responsible for the mortgage payments, and what will happen to any equity in the home.
Title the Property Correctly.
The way you title the property will affect how it’s divided in the event of a split. There are three main ways to title property:
Joint tenancy: This means that both partners own equal shares of the property and have equal rights to it. If one partner dies, their share will automatically pass to the other partner.
Tenancy in common: This means that each partner owns a specific percentage of the property. If one partner dies, their share will pass to their heirs, not to the other partner.
Tenancy by the entirety: This is only available to married couples. It’s similar to joint tenancy, but it provides additional protections for the surviving spouse.
Get legal Advice.
It’s always a good idea to consult with an attorney before buying a house with an unmarried partner. An attorney can help you understand your rights and options and ensure that you’re protected in the event of a split.
By taking these steps, unmarried couples can protect themselves and their financial interests when buying a house together.
In addition to the above, there are a few other things unmarried couples should keep in mind when buying a house together:
- Be honest with each other about your financial situation. This includes your income, debts, and assets. It’s important to be on the same page financially before you make such a big commitment.
- Set clear expectations for how you’ll share the responsibilities of homeownership. This includes things like who will make the mortgage payments, who will do the repairs, and who will be responsible for the property taxes.
- Be prepared to compromise. Buying a house with someone is a big decision, and there will be times when you need to compromise. Be willing to listen to each other’s needs and come to agreements that work for both of you.
Buying a house with an unmarried partner can be a great way to build a life together. But it’s important to take the necessary steps to protect yourself in the event of a split. By following the tips above, you can make sure that you’re both on the same page and that your interests are protected.
