Moving in with your partner or buying a house together when you are not yet married needs a little extra thought before proceeding. From a legal point of view, there are a few things to consider!
Living together as a couple before marriage is now quite common but unmarried couples must appreciate that they are not protected by the law in the same way as those who are married – common law marriage does not exist.
Ownership
Most couples will look at buying a house jointly and there are two types of joint ownership:
A joint tenancy
- you have equal rights to the whole property
- the property automatically goes to the other owners if you die
- you can’t pass on your ownership of the property in your Will
Tenants in common
- you can own different shares of the property
- the property doesn’t automatically go to the other owners if you die
- you can pass on your share of the property in your Will
Protecting your share (as a ‘tenant in common’)
It is advisable to sign a Declaration of Trust which is a legally binding document which clearly outlines what you each own and how the value of the property would be divided should you ever separate in the future.
Without signing a Declaration of Trust, both parties could risk a complicated legal battle. If you don’t detail your individual shares in the property and you then later disagree on who should receive what, it may result in a costly court case.
Making a Will
It is particularly important for a cohabiting couple to make Wills, whatever the choice of joint ownership.
If you decide to buy the property as tenants in common the surviving partner will not automatically be entitled to the remaining share of the property, instead it will become part of the deceased’s estate.
If you decide to buy property as joint tenants if one of you dies the deceased’s interest in the property will automatically pass to the survivor but not the rest of their estate.
Living Together Agreement
Finally, all contributing factors can be incorporated into a Living Together Agreement which ideally will be drafted alongside the Declaration of Trust. A Living Together Agreement can also detail mortgage payments, payment of bills, life insurance, pensions and Wills.
