In difficult economic times, people can struggle in attempting to get a loan. A married couple may have a tough time buying a house. However, an unmarried couple will have a tougher time.
Many mortgage companies won't treat the possessions of a couple that aren't married as joint assets. They treat them as two individuals that have separate assets. This may happen even if they both have proof of their relationship. Proof may include other property that they both jointly own, trusts or wills.
Names on the Deed
In order to protect both individuals of an unmarried couple, both their names should be on the deed. Many women make the mistake of trusting their boyfriends completely. They don't put their names on the deed. This may leave them legally unprotected if they split up. Having both names on the deed will help prove later that they both share ownership of the house.
Having a Property Plan in Place
Unmarried couples don't have the same legal rights and protections that married couples do. The way to solve this problem is to have a written plan in place. Having a written contract will help with legal problems in the future.
One item to determine is how the ownership of the house will be shared. Most couples will choose to share the house equally. That means it's a 50/50 even split. Sometimes one individual in a couple will have more money. She may pay more of the down payment and monthly mortgage payment. The couple can agree to give her a larger ownership share of the house.
Another decision to determine is what happens if one of the individuals dies. One option is to write in the contract that the couple has a joint tenancy with the right of survivorship. This means that the surviving person receives sole ownership. This option allows the house to be transferred easily to one person.
Another option is to write that both individuals are tenants in common. This means that each person decides who receives their share. The decision can be written in a will. The share will usually go to the closest relative if there's no will, as set out in the intestacy laws of the state where the property is located.
An attorney can help you review your plan, and make sure that the property's deed and related documents correctly reflect your arrangement.
Even though most couples don't like discussing it, they should make plans if they decide to split up. It should be written in the contract how they'll get their money back from the house. If one of them contributes more money, she can receive a larger amount back if they separate.
If one person decides to keep the house, he could buy out the other person. However, there may be a problem if both people want the house after a break up. The couple should decide beforehand in the contract who gets to keep the house. They should also agree as to how the house will be appraised and how long the other person has to pay off the purchase price.
Questions for Your Attorney
- If I'm not married to my girlfirend, what's the safest way to purchase a house together that'll protect both our interests in the property?
- If my boyfriend and I split up after we buy a house, who gets to keep the house?
- If a couple have both their names on a property title, does it matter that one of them pays all of the house expenses?
- If an unmarried couple owns a house and one person dies without a will, are there exceptions to intestacy laws to keep that person's share of the house from going to her next of kin?