The number of unmarried couples cohabitating in the United States is well into the millions. For those who are involved interpersonally in domestic partnerships and essentially living their lives as if married, though not legally so, there are important financial considerations they must keep in mind in order to protect themselves and their future.
Financial Red Flags for Unmarried Couples
As a couple’s relationship develops to the point where they are making joint financial decisions, such as buying property together, there are some important financial red flags to be aware of.
For one, if you “share” an asset with another person, yet that asset is not jointly titled, you essentially have zero legal stake in the property. That means the sole owner (presumably your partner) has full legal power to sell the house or will it away even if you or someone else has contributed financially to it.
Conversely, if you take the title as joint tenants or as tenants in common, you and your partner will both maintain partial ownership of the property. In order to protect your financial interests as an unmarried couple, it’s best to consult an attorney prior to committing to any kind of a joint purchase or investment.
Protect Yourself with a Partnership Agreement
For unmarried couples, a smart step to secure your interest in the property is to create a contract or partnership agreement for owning the property. The contract should spell out specifically what will happen to the property and your assets if x or y were to occur or if the relationship were to end.
Importantly, a contract can protect everyone’s financial interests in the property and offer peace of mind. What’s more, without a written contract, you could end up in court.
Safeguarding your financial future is important whether or not you are married. For unmarried couples, it’s imperative to take additional steps to develop written contracts and keep detailed records and receipts for all things in case a dispute was to arise.
If you need help understanding the dangers of not being married and the legal and financial risks you might take on with joint purchases, come talk to us at the Vasquez de Lara Law Group.