Couples buying a home together prior to marriage is on the increase, this could be through choice or with the intention of getting married later. Either option is fine, and both are a personal choice.
However, this option comes with downfalls that do not affect married couples due to their automatic legal rights which cohabiting couples currently do not have.
A “Common law marriage” is a myth and does not exist or have any rights in a court of law, consequently it is important to protect your legal and financial interests.
It’s often a taboo to talk about financial and legal matters in a relationship as it’s perceived to be unromantic and can bring up questions of distrust, but it’s the sensible thing to do to protect yourself.
To protect and provide security for yourself, a cohabitation agreement is an easy way to set out who owns what, any financials arrangements and how assets should be divided if you split up.
The cohabitation agreement can be made as detailed as you want; including belongings, contents, property, savings and much more.
Cohabitation agreements are also useful if you are buying a home with someone you’re not in a relationship with, friends, parents, siblings and much more.
A declaration of trust is also usually included in a cohabitation agreement – this is a binding contract that confirms what share of property each person owns, how the assets will be divided in the event of a sale or split, and the payment of the mortgage.
The agreement covers various eventualities and all to protect the legal and financial interests of all parties.
Another way to protect your assets is to have a will. Wills are a good idea for anybody, but are particularly important for cohabiting couples. For married couples in the event of death the widow automatically inherits their spouse’s estate – for cohabiting couples there is no such automatic right.
A will is a legal document that will set out what happens in this event.
Both options are particularly helpful should the relationship sour and will prevent any bitter disputes at an already traumatic time.