The Unmarried Couple Home Buying Dilemma

• February 6, 2017
• 26 Comments

by Craig Davitian

This article was originally published in March 2011.

When a couple decides to buy property together, their status (married, domestic partnership, common-law married, etc.) does not have immediate implications.

However this changes when a property-owning couple ends their relationship, as their status becomes very important in determining how property—real and personal—will be divided. (Real property is real estate, personal property is everything else.)

While there are well-established laws that govern property division for divorcing married couples from state to state, no such laws exist for unmarried couples.

Many people mistakenly believe that couples who live together for seven years are automatically married by common law. However, only 15 states and DC recognize common-law marriage by statute, and among this group, there is little uniformity, particularly when it comes to dividing real property. Domestic partnerships, depending upon where you live and whether you are registered as a domestic partner, might provide one partner an implied right to share property. However, laws governing domestic partnerships can change by state, county or city.

Therefore, the best advice for all unmarried couples buying a home together is the same: sign a written property agreement with your partner.

It sounds obvious, but before putting anything into writing, have an honest discussion with your partner about your respective “visions” for handling property (real and personal) if the relationship ends. Your aim is to develop a plan (agreement) that keeps working when the relationship stops working.

Then pay a visit to an attorney and have your plan written into a “property agreement.” The process is easy and will cost you far less than not having one. If the parties have done their due diligence and talked through everything, then it will only cost a few hours in lawyer’s fees.

Anything can be encompassed in this agreement, but it is critical to at least address the following three items:

1) What percentage of the property is owned by each person? (This is a particularly important issue if one person is taking a larger financial stake in the property payments or down payment than the other.)

2) How is the title or ownership described in official records?

3) What will happen to the property if the relationship ends? Will it be sold and the proceeds divided? Can one person stay in the property and buy out the other person?

While contingency planning the possible demise of your relationship may be unpleasant, you should look at the agreement as merely an insurance policy of sorts—you hope you will never need it, but it you do, you will be very thankful you have it.

Craig Davitian is an attorney with the Davitian Law Firm and is licensed in the District of Columbia and Maryland. This information is not legal advice and is offered for educational purposes only.

This article originally published at https://dc.urbanturf.com/articles/blog/the_unmarried_couple_home_buying_dilemma/3168

26 Comments

1. Mike said at 9:19 am on Friday March 18, 2011:

   I faced this dilemma a few years ago.  Bought a house with my long-term girlfriend.  I put down the down payment from a previous house sale and cash.  When the relationship ended a few years later, we had to sell the house (because no one could afford the payments on our own).  We sold the house for almost exactly what we bought it for (including commissions), but since we didn’t have any agreement in place, I lost the $35k equity I had put into it (i.e., she enjoyed by money closing the gap on the sale). A life lesson I guess, but an expensive one.

1. mona said at 5:07 pm on Monday August 20, 2012:

   They should also think about how they buy the property. Should by with notion that in the event of the others death the other becomes the sole owner and 1/2 the house doesn’t go to the other persons family.
   I also saw a friend buy a house and put his girlfriend on the deed but not the mortgage. When she ended the relationship she demanded her 1/2 of the house and he had to sell it.

1. j said at 3:37 pm on Tuesday August 21, 2012:

   bottom line- and I hate to say it, but,don’t buy( or seriously reconsider) property with someone unless you are married- its a no brainier

1. Susan Isaacs, Realtor said at 3:38 pm on Tuesday August 21, 2012:

   Always wise to consult an attorney about options before entering into a real estate contract with another person, even a spouse under some circumstances. One slightly uncomfortable meeting can save both parties a great deal of angst later.

1. Dana Hollish Hill said at 11:53 am on Sunday August 26, 2012:

   I have to agree with Mona that the type of ownership should be defined up front. Thinking about a potential break-up is one thing, but preparing for one persons death is another. 

   These issues are also very important when one or both of the people were previously married and have children from those previous marriages. A lot of drama can be avoided with a good will or trust or property agreement that considers a wide range of foreseeable circumstances.

1. gravelstick said at 5:12 pm on Thursday September 20, 2012:

   But what if….help!!....what if I buy the house, its in my name and I put down the full down-payment (BC I am currently more financially stable at this point) but he wants to still live with me.  Now, I know how it sounds…its not my living situation of choice…but he hasnt been very responsible with $$ before me.
   Anyway,....obviously I am not going to let him live scott free….so he pays half the monthly “rent”...morgage.  Is there any law that states IF we do split down the line, that I have to re-issue him a percentage of what he paid me?? I look at it as “rent” but he looks at it as if he is paying into a portion of the house.

   HELP

1. Melisa said at 9:15 pm on Sunday January 20, 2013:

   My ex and I bought a place together. His name appears first on the loan. Now his mother is threatening that they can kick me out at any time. Is this possible?

1. zcf said at 2:43 pm on Tuesday June 11, 2013:

   To gravelstick

   Without an agreement in place and given that you’re not married and the house is under your name… I don’t see how your bf has any claim to the house. But as with everything, you probably need to consult a laywer (not sure if there is such a thing as common law marriage).

   But anyways - your bf sounds like a loser.  Can you really see yourself married to him?  Establish up front that it’s yours and that he’s paying rent.  Make him sign a lease. You don’t have a ring on your finger, so don’t treat him like a husband.

1. DC resident said at 2:44 pm on Tuesday June 11, 2013:

   Melisa - I don’t see how.. unless you suddenly stopped paying.

1. Harry Weese said at 3:35 pm on Tuesday June 11, 2013:

   One word:  Palimony.

1. Zesty said at 4:40 pm on Tuesday June 11, 2013:

   Does DC allow Palimony? It seems scary to have to pay support payments to someone you’re not married to.

1. Duponter said at 4:42 pm on Tuesday June 11, 2013:

   If you want to understand how to do this, ask any gay couple that, until recently, did not have the option of marriage (insert political argument as to why marriage rights for gay couples is important).  My former landlord went through this when he and his partner of over 20 years split.  It isn’t just about losing equity, you also have different tax implications if you are not married that couples divorcing do not face.

1. TurfReader said at 5:32 pm on Tuesday June 11, 2013:

   I recently bought a home with my girlfriend.  Yes, it’s risky but I think we did it in a fairly smart and simple way.  Number 1, the loan is only in my name. If we split up, we don’t have to worry about who owes what portion of the house.  Number 2, I bought a home that I could afford on my own, if need be.  While I would rather not be paying for the home on my own, this is doable in worst case scenario. I think it’s extremely risky for any person to sign a loan that they can’t afford on their own.

1. Curious said at 5:45 pm on Tuesday June 11, 2013:

   @TurfReader,

   That sounds like a pretty good solution, but does your girlfriend contribute to the mortgage? If so, how do you work that payment out?

1. TurfReader said at 6:37 pm on Tuesday June 11, 2013:

   Curious,  we split everything down the middle.  We each pay half of the mortgage, as well as utilities.

1. TurfReader said at 6:40 pm on Tuesday June 11, 2013:

   And yes, that means she would not get any of that back.  However, it’s no different than if she were renting an apartment and it’s still a win for her because the mortgage is much less than what most apartments cost.

1. Duponter said at 8:49 pm on Tuesday June 11, 2013:

   Turfreader, if she is paying half the mortgage, she would have a strong claim that she owns half the house if you split, regardless of your mortgage.  I’m not 100% sure how DC handles those issues, but in other states, common law rights allow an unmarried partner who has proof of financial contribution to get a piece of that pie. 

   Granted, if she made such a claim, she’d also be subject to all the taxes that come along with selling a property that she owned part of.  So she may not be so inclined.  But you’d do better to actually set up a rental agreement with her.  Understanding of course asking for such might hasten the demise of your relationship. 

1. Zesty said at 12:28 am on Wednesday June 12, 2013:

   @TurfReader,

   According to this DC law firm; DC allows for a “common law” marriage. So if she’s paying half the bills, she may have a legal claim to some of the house (I’m not a lawyer but I’m sure she could sue you). So I think that’s the point of this article, if you don’t have it in writing you may run into issues. I.e., I don’t think you’re as secure as you think you are.

   http://whiterulawfirm.net/591/common-law-marriage-in-maryland-and-washington-dc

1. TurfReader said at 1:22 am on Wednesday June 12, 2013:

   Interesting. But what if she signs a lease? Wouldn’t that be the same as a tenant or a roommate?

1. Duponter said at 11:51 am on Wednesday June 12, 2013:

   Signing the lease shows at least intent that she is not contributing as an owner of the property, but as a renter paying rent.  She’d have a harder time making a claim that you two purchased the house together even if her name isn’t on the mortgage.  It might not be air tight, but it would certainly weaken any claims later down the road that she might make. Without one, she can always argue that it was an agreement that she would pay half the mortgage.  As such, she is paying for an ownership interest in the house.  Without some documentation to the contrary, you could find yourself in trouble.  A lease would probably go far to solving that.  Just keep all written documentation that shows that there was no intent that she is contributing to the ownership and is instead a renter.

1. UrbanTurf said at 12:33 pm on Wednesday June 12, 2013:

   @Duponter:  Thanks, this is good advice. I will definitely do this.  Fortunately, we’ve already talked about this so I don’t think it’ll be an issue.

1. C said at 10:11 am on Thursday July 11, 2013:

   I have heard what Duponter and Zesty have said about common law marriage in DC and even if partner name is not on mortgage, that person could go to court and claim a percentage or partial ownership to the home if s/he contributed financially.  I would seek the advice of an expert, though, before taking what any of the commenters here (myself included) to heart.  As well intentioned that I think commenters here are, sometimes intricacies are overlooked. 

   As for the question of making a partner sign a lease (rent) to live in the home, can this be done without a business license to be a landlord in DC?  Does anyone know if this step would have to be taken in order to have the other person sign a lease to live in your home?  If partner signs a lease, that means owner has become not only an owner but also a landlord and being a landlord in DC requires a business license?  Interested to have clarity on this subject. 

   Thanks

1. Jodi said at 4:46 pm on Sunday July 21, 2013:

   My partner and I purchased a home together with both names on the mortgage. We are splitting and she wants to sell the home, I want to hold on to it for one more year to avoid capital gains tax. I can afford the mortgage with a roommate to help with $.

1. maria nhlabathi said at 10:33 am on Friday September 20, 2013:

   my problem is i bought a house with a man and now he has passaway but i pay the bond now what must i do?

1. Brittany Turner said at 2:46 pm on Tuesday October 8, 2013:

   Here’s my question, my husband bought a home with his ex. She never paid any money towards it and we have records that he paid all the mortgage, taxes, and down payment but she is on the mortgage & deed. Now 5 years later she wants us to pay her $10000 to sign over her half of the house. If we sold it now it would only sell for $90K does this sound fair?

1. Jodi said at 3:27 pm on Monday January 2, 2017:

   I bought a house in 2006 title and deed in my name only however at the time my now ex girlfriend gave me 25,000.00 for the down payment as at the time she was moving in with her 3 kids. The relationship had been over for over 4 years now and although she did treat it like her home while she was there, she now will not leave as she feels the house is 50% hers.  I was willing to pay her back the 25,000.00 and anything else she has receipts for… but does she have ownership rights?  Any help would be appreciated.