Living Together Tips and Traps

Here is an issue without age boundaries:  cohabitation.

If you are living with someone to whom you are not married, then you are cohabitating. If you are cohabitating, then you have issues that need to be addressed.

What issues?  Consider this:  you and your friend buy a house together.

  • Who is responsible for paying the bills?
  • What happens if your friend fails to pay his or her share of the mortgage?
  • If your friend dies, what happens to his or her share of the house?
  • What happens to the house if you and your friend split up?

Or consider this:  your friend decides to claim that your relationship is, or was, a common-law marriage.

Is that something that you really intended?  How will you feel about your friend claiming that he or she is entitled to one-half of all of your property and maybe a little alimony?  Or the idea that you will have to go through a divorce, with all of its attendant legal fees, to end your relationship?

Does this sound like a nightmare?  You are in luck because the path to a happy resolution is simple.

You need a cohabitation agreement.

You need to enter into it before or as close as possible to the time that your living arrangement begins.  Consistent with current law, you should have one regardless of the sex of your friend.

Your agreement must be in writing and signed by you and your friend.  It should set forth the ground-rules.

Here are a few points that you should consider including.

  • It should state that you and your friend are not married and you agree not to create a common law marriage.
  • It should contain a list of your existing assets.  You should each make a list of your assets and who owns them, and attach those lists as exhibits to the agreement.
  • It should address how the assets you jointly own will be divided in the event your relationship ends.
  • It should describe how you and your friend will purchase and finance real property, like a house.
  • It should describe how you and your friend will split the payments for jointly owned property.
  • It should address which of you will pay maintenance and taxes for the property, and whether that person is entitled to some type of reimbursement if you split up.
  • It should describe what happens to your residence if you split up.  Who can stay in the property?  How quickly must the other person move out?
  • If you are going to have a jointly owned bank account, then it should address how much each of you are contributing to it on a monthly basis.
  • If you and your friend intend to name each other as agents on powers of attorney or give other rights, then it should reference those documents.  Note that these are separate documents that must be signed.

Cohabitation can cause a complex problem.  Isn’t it nice to have a simple solution? Together:  Tips and Traps

Virginia Hammerle is a licensed Texas attorney.  Her practice includes estate planning, litigation, guardianship and probate law.  See hammerle.com for her blog and newsletter sign-up.  This column does not constitute legal advice.