How do I protect my interests if we buy a home and aren’t married?

Purchasing a home together but haven’t yet tied the knot?  What you need to know to protect your interests.

While unmarried couples may not want to tie the knot at this moment, they may nevertheless seek to purchase a home together.  When entering into a purchase transaction, each party bears the risk of the other party failing to keep up with mortgage payments.  Or, of course, the couple may break up.  To mitigate these risks and other adverse possibilities, unmarried couples should retain the services of an experienced real estate attorney to draft a Partnership Agreement, establishing each parties’ liabilities in the event of a dissolution. This agreement should be executed before the couple proceeds on signing a mortgage and closing on the home.

The Partnership Agreement should articulate the payments each party is making on all costs including, but not limited it, the down payment, principal and interest, utility, taxes, home improvement and maintenance expenses.  The purpose of the agreement is to specify which party is to receive what amount of funds in the event of a dissolution, sale, or death of a party.  The recording and tracking of these payments allows for a readily calculable “percent interest” that attributes equity in the property to each party.  The parties can use this calculation in determining unequal equity in the event the couple decides to terminate the agreement, sell the home or dies so that each party (or their heirs) will receive their respective share of the proceeds.  

When unmarried couples seek to purchase a home together, it would behoove them to retain the services of an experienced real estate attorney to draft a Partnership Agreement so the couple can prepare for the unexpected.  This will mitigate the risks and eliminate uncertainty if problems with the relationship should occur.  
The law firm of Mattleman, Weinroth & Miller, P.C., is composed of experienced attorneys throughout the states of New Jersey and Delaware. Please contact the office for a free initial consultation and get any questions answered regarding your specific case.