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FAQs About Residential Conveyancing: I’m buying a house with my partner. How do I protect my investment?



In the fourth mini blog in the series of FAQs about Residential Conveyancing, Jessica Castella, Solicitor in our Bath office, explains how best to protect your investment when buying property with a partner.

The fastest growing family type is the cohabiting couple. Now, more than ever, couples are deciding to live together before they get married. This can, however, lead to legal implications if the couple splits up. Married couples in England and Wales have the benefit of certain legal rights should the marriage come to an end, but cohabiting couples do not have the same legal protection.

If you choose to buy a property with your partner, when you are not married, there are steps that you can take to ensure that your interest in the property is protected, in the event the relationship breaks down.

Property Ownership

Once the decision has been made to purchase a property together, it is also important that both parties fully consider their intentions. There are two forms of joint ownership to choose from: Joint Tenants and Tenants in Common.

If you choose to own the property as Joint Tenants, the property will be considered to be owned jointly, and in the event of the death of one owner, his/her share in the property will be automatically transferred to the surviving owner. This is known as the ‘Rule of Survivorship’

If a couple prefers to keep their interests in the property completely separate, it may be better to purchase the property as Tenants in Common. This will mean upon death the property will not automatically go to the survivor, and what happens to the deceased’s his/her share in the property will depend on what he/she has put in their Will.

A Declaration of Trust

Unmarried couples can seek independent legal advice to protect their investment in the event of a separation. One option is to sign a Declaration of Trust before they purchase a property together, which can ensure that if, for example, one party paid in £25,000 for a deposit they will be entitled to get that back from the sale of the house. It can be an essential document in protecting individual contributions.

Cohabitation Agreement

Another option is a Cohabitation Agreement. This is a written agreement that outlines the ‘intentions of ownership’, and that goes into the particulars of a couple’s financial situation, liabilities, belongings etc.

Whilst no couple wants to consider the possibility of a breakdown in their relationship, there is peace of mind and value in making sure you are protected should a breakup happen. If you are looking to buy a property, and need a Declaration of Trust or a Cohabitation Agreement, then please do not hesitate to get in touch with us at Mogers Drewett.

If you have any queries or want to discuss your options, please do not hesitate to contact us on: 01225 750000 (Bath), 01749 342323 (Wells) or 01935 813691 (Sherborne).