Moving in with or marrying your partner is an exciting time for both parties. It is you moving forward together to the next step in your lives. It is important, however, to have a plan and relationship agreements in place if the marriage were to end
The Long of it
If you are moving in together
What is a cohabitation agreement?
Buying a house with your partner is an exciting time – a new chapter in your lives together – and you probably won’t be thinking about what happens if you split up.
Hopefully it won’t happen. But if one of you is contributing more to the deposit, and/or paying more than half the mortgage, you may assume you’ll get your original investment back if it does. Unfortunately, this is not necessarily easy to achieve.
Cohabitants have fewer legal options than married couples in this situation, so if you can’t agree a fair outcome between you, there may not be much a court can do to help. While you can ask a court to order the sale of the house, the default position is for the sale proceeds to be shared equally if you have equal shares of the title. If you put more capital into the purchase, this will not be a fair result – but persuading the court to order unequal division is far from straightforward and adds to the complexity and cost of the process.
One way to resolve this issue is to sign a cohabitation agreement before you complete the purchase. This will normally state that if you separate – or just want to sell for any other reason – you will get back the amount of your original investment plus half of any increase in value, provided there is enough equity. This type of agreement also usually gives you the option to buy the other person out. A court can’t order this if you’re unmarried, so it’s the only way to get the property transferred into your sole name if this is your preference.
If you are getting married
What is a prenuptial agreement?
If you’re getting married, the last thing on your mind will be worrying about what happens if you split up. There’s so much planning to do, why add a prenuptial agreement to your to-do list? And it’s hardly the most romantic discussion to have with your intended.
Sadly, however, you may still find yourself divorcing further down the line. If this happens, a prenuptial agreement will give you certainty about how specified assets are treated – cold comfort perhaps but it can make divorce proceedings less fraught.
When we say assets, we mean things like pensions, pre-marital savings and property bought before you got married. You don’t have to be worth millions for these to be worth protecting from your spouse’s divorce lawyer in ten years’ time.
And if this is a second marriage, you may want to make sure the assets you have amassed will pass to your children from the first marriage and not your new spouse if you separate. (That’s why we recommend a review of your succession planning, too.)
Most prenuptial agreements will ring-fence assets from future financial provision on divorce. This normally covers not just the premarital assets themselves, but anything you acquire during the marriage.
For example, you might sell an investment property to buy another. If you don’t have a prenup, you can still try to exclude this asset in divorce negotiations, but this can be complicated and there’s no guarantee of success. If it’s covered in the agreement, you both know where you stand – and it costs less in legal fees to sort this now rather than arguing about it later.
While the Scottish courts do tend to enforce prenuptial agreements, in some limited cases there may be an argument that yours should not be followed. If you are in this position, we can evaluate this for you. If we are the ones doing your agreement, we will take steps to protect it against challenge, such as asking your partner to take separate legal advice before signing and allowing enough time for them to do so. This also means the earlier we speak to you about this, the better!
We hope that once you sign your prenuptial agreement, it will simply go in your desk drawer and never need to be taken out again. But if things do go wrong, it’s worth having the clarity and certainty an agreement can provide.
Why choose Watermans for your relationship agreement?
We’re experts in family law and we know our stuff – but we’re also normal people you can have a real conversation with. We don’t use legal jargon (or Latin), we give straightforward advice, and we won’t judge or patronise you. Coming from a range of backgrounds and with our own life experiences to draw on, we understand and empathise with how stressful family disputes can be. We know how important it is to trust your lawyer and that you need to know we’re in your corner. Our aim is to work in partnership with you to help resolve things quickly and cost-effectively so you can move forward with your life.
Get in touch with us
Everything we do at Watermans is about getting you the resolution you need and making that process straightforward. Start the process by sending us your details below or calling us on 0131 555 7055
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Our Family Law expert
“People often say to me that family law must be a depressing job – but I’ve never felt that. What we do makes a difference. I love working with my clients to understand their stories, help them work out where they want to get to, and collaborate with them to achieve their goals. Seeing people come through it and embark on a new stage of their lives is a great feeling.”
Dianne Millen, Head of Family Law