Updated on December 3, 2019
Ownership disputes among non-married couples are quite common. These types of disputes typically lead to quiet title claims or partition claims depending on how the parties hold title.
There are several important things to consider when buying a house with a boyfriend and girlfriend.
The first thing to consider is how title will be held. This is an important question because how the couple holds title can determine who obtains ownership of the property in the event one of the parties unexpectedly dies. Generally, a married couple would hold title as joint tenants or as community property. With a joint tenancy when one of the title holders dies their interest in the property automatically passes to the other person. In other words, when one person dies in a joint tenancy the other person automatically acquires the deceased person’s interest. In contrast, holding title as a tenant in common allows each person to separately determine who they would like the property to go to in the event of their untimely death. We typically recommend that an unmarried couple purchasing a property purchase the property as tenants in common as this allows the greatest flexibility in determining the person’s estate planning needs and allows for a change of circumstances that they may not have anticipated at the time of the new home purchase.
We also recommend that the unmarried couple reduce their understanding regarding the property to writing. For example, if one part of the couple is responsible for more of the down payment or more of the ongoing expenses it is a good idea to reduce that agreement to writing prior to purchasing the property. We frequently deal with family members and unmarried couples who wind up in litigation (a court battle) because they did not reduce their agreement with respect to the property to writing before buying property and a disagreement arises over each person’s rights and responsibilities with respect to the property.
Finally, we recommend coming up with an agreement for how to handle the situation where one person later wants to sell the property and the other person does not want to sell the property. This situation typically arises where one of the two people moves out of the property and want to sell the property while the person remaining at the property does not want to sell. In these situations, the person living outside the property will typically sue to partition – have the court order the sale of the property. These types of lawsuits can be expensive. Accordingly, we recommend that the parties agree on a method to resolve this situation – like providing a right of first refusal or figuring out a valuation method so that in the event one party wants to sell there is a buy-out mechanism in place.
For help with your ownership dispute, please contact Schorr Law at (310) 954-1877, [email protected], or send us a message by using our Contact Form. Contact us now to inquire about a free 30-minute consultation.