“I’m moving in with my partner and we intend to buy a house together. My parents have suggested I contact a Solicitor to protect myself legally. How can a Solicitor help?”
Living together or buying your first home as a couple is a big step and it is easy to get caught up in the excitement of house hunting and choosing furniture for your new home. However, without a formal agreement, such as a cohabitation agreement, you put yourself at financial risk if you decide to separate.
If you are purchasing a property as cohabitees the property needs to be purchased by the two of you as “Tenants in Common”. This means that you will own specific shares in the property, and you can specify if one of you owns a larger share if a larger sum has been put into it. If you contribute to the purchase in unequal shares and purchase as what is known as “Joint Tenants”, on separation the property would be divided equally, whatever contributions had been made to the purchase and could leave one of you feeling that you have been treated unfairly.
“rights a married couple have do not apply to you as you are living as cohabitees”
Despite popular belief the term ‘common law spouse’ or a ‘common law marriage’, does not exist. Therefore, the rights a married couple have do not apply to you as you are living as “cohabitees”. This includes the fact that you have no claim on pensions or on each other’s assets.
What is Cohabitation?
Cohabiting in the UK is defined as an unmarried couple who are living together in a long-term relationship, which resembles a marriage. Unmarried couples are often referred to as living in ‘cohabitation’. You can share finances, children, property and possessions, as a married couple would, but you do not have the same legal rights.
What are the challenges with Cohabiting?
Property & Possessions
As a cohabiting couple are not married, they do not need to formally separate. Therefore, they do not need to divide up their assets and finances as a married couple would, unless assets are owned in their joint names. This means if possessions or property are held in sole names, legally these belong to that person and it may be difficult to prove they were paid for jointly. Any items owned by you prior to the relationship or which you have purchased or received as gifts are yours.
If one of you already owns property and the bills have been set up before your partner moves in, it is still very important to discuss what each of you will pay and the implications this will have. You will not accrue interests in the property by simply living there for a lengthy period of time. You would only accrue a possible interest in the property if you contributed to, for example, improvements to the property that added to its value, simple decoration would not result in your accruing an interest in the property.
If you are living together and you and your partner have separate bank accounts, neither of you have the right to access money held in the other partner’s account.
If you open a joint account, even if you do not use this account, and the account runs into overdraft you are jointly liable for such an overdraft.
If one of you passed away your cohabitee’s possessions and/or property would pass under the intestacy rules to their next of kin, unless they had made a will. If a property was held in their sole name you would therefore have no rights to reside in the property. It is therefore vital for both of you to make wills to protect the other on death of the other party.
If you have Children, the father does not automatically have parental responsibility in the same way as you would if you were married, unless the father is named on the birth certificate.
How can I protect myself living in Cohabitation?
The best way to avoid disputes is to agree who owns what, who will pay what and what will happen should the two of you separate in the future, record this agreement in writing in a ‘cohabitation agreement’. This is where a Solicitor can help.
What will a Cohabitation Agreement do?
A cohabitation agreement (also known as a relationship or living together agreement) records the arrangements between the people who live together.
Cohabitation agreements generally cover:
- Ownership of property
- Ownership of personal belongings
- Contribution to finances, mortgage/rent, household expenses etc
- How to resolve ownership of joint accounts
- Cover issues relating to children i.e. who they will live with, spend time with and financial provision on separation in the future
Cohabitation agreements eliminate the potential for disputes and the substantial financial and emotional costs that litigation incurs.
Agreeing who owns what and documenting it, removes any issue so people can have the certainty and reassurance they need.
A Solicitor can draft a cohabitation agreement that is tailored to your situation and relationship. Furthermore, they can draft a will, trust and power of attorney if needed, to fully protect you and your family.
If you separate, a Solicitor can also help negotiate a financial settlement and can help investigate your position and advise you on all key issues: property, finances, assets, and provision for children, including trusts, child support, mediation and orders relating to children, known as Child Arrangement Orders which cover who a child lives with and spends time with (previously known as Residence and Contact Orders).
If you would like to discuss your situation further, I offer a free 30 minute consultation and fixed fees on cohabitation agreements if you wish to draft one.
Written by Wendy Bailey, Matrimonial Solicitor
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