What are the Laws for Cohabiting? How Cohabitation Agreements Can Protect You.

The total number of cohabiting couples has increased from around 1.5 million in 1996 to around 3.5 million in 2020. In 2020, 18% of couples that lived together were cohabiting rather than married or in a civil partnership, yet there has been no adequate development in the law in order to support this type of societal shift.

Since the onset of the pandemic, more and more couples have chosen to accelerate their decision to live together due to the various “lockdowns” and restrictions.  Whilst this might seem the most natural and sensible thing to do in the current climate, the reality is actually quite different.

It takes around three years, on average, for a couple to save a deposit to purchase a property together and, the pandemic has caused property prices to rise astronomically. This has seen couples taking far greater financial leaps in order to make the elusive dream of getting on the property ladder become a reality. Similarly, some couples may choose to sell their own properties in order to buy a property together, and will invest their individual capital sums which they have built up independently over time, into that joint property. Other cohabiting couples may live in a property which is owned by only one of the parties.  

Whatever the individual circumstances, many cohabiting couples are of the mistaken opinion that they are in a “common-law marriage”. Owning a property together, and indeed merely living together, does not give a couple the same legal protection as marriage or a civil partnership would, regardless of the length of the cohabitation period.  That said, there can also be situations where your partner might acquire an interest in your property, when you didn’t particularly want them to. 

Unless your interests are properly protected, there could be a lot at stake. There are a number of ways you can each protect your interests as a cohabiting couple, and people are often surprised that there is more than one way of owning a property with another person.

“Beneficial Joint Tenants” – As beneficial joint tenants, you will each own a half share in the property, regardless of any uneven contributions made towards any deposit or mortgage repayments. The “right of survivorship” will also apply, meaning that if you were to die, your share would automatically transfer to your partner. You might not want this to happen if there are children from a previous relationship who might need to be provided for, and you may want to consider other options.

“Tenants in Common” – As tenants in common, you will each own a distinct share in the property. This might still be a half share, but the shares can also be unequal. It is common for couples to decide that the amount of any deposit paid by either party can be recouped by that party on sale, with the remainder of any net sale proceeds being split between the couple in either equal or unequal measures. This type of arrangement can be dealt with and firmed up more extensively by a document called a “Declaration of Trust”.

The “right of survivorship” does not apply. This means that, if you were to die, your share of the property would pass in accordance with your Will. If you do not have a Will, then the rules of intestacy would apply. You should therefore always consider having a Will drawn up in these circumstances.

More and more cohabiting couples are now choosing Cohabitation Agreements to give them the peace of mind they need. Cohabitation Agreements are intended to be legally binding documents which record a couple’s intentions and wishes relating to the property in question throughout their relationship, and in the event of separation. It can address things like whose responsibility it is to repay the mortgage and the bills. It can cover repair and maintenance requirements and it can even set out what should happen if the couple were to separate.

Cohabitation Agreements are becoming more and more popular given that their legally binding nature can save a lot of issues and legal expenses in the event of an unamicable separation.  

Moving in together is a very big and exciting step. However, the law is complicated, love can be blind and this can often lead to devastating consequences. The Family Department at Mackenzie Jones can help you to be sure that all of the right measures are in place, so that you can look forward to your future with both confidence and peace of mind.   

Contact us today on 01745 536030 to see how we can help.