The Long of it
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.
Is it complicated?
Is creating a cohabitation agreement a complicated process?
An agreement like this does not have to be complicated or involve a lot of back and forth with solicitors when you’re already dealing with the property purchase (and maybe also a sale).
As your solicitor, we need to explain the underlying law and confirm the outcome you want to achieve, but we can normally send you a draft agreement shortly after that. Our family team can only act for one of you even if we’re dealing with the purchase, but we’ll refer your partner to another solicitor so they can get independent advice – not only is this the right thing to do but it also gives you some protection if you have to rely on the agreement later.
Is it expensive?
Is creating a cohabitation agreement expensive?
Buying a house is already expensive and it’s understandable not to want more legal fees on top of this. However, we can usually prepare a cohabitation agreement for a fixed price so you can budget. If you’re investing all your savings in a property, can you afford not to safeguard your investment?
Why choose Watermans for your cohabitation agreement?
At Watermans, we have over thirty years experience in the legal sector. 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.
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
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