Have you decided to take things to the next level with your Valentine and move in together?
Sharing a home comes with its own challenges; such as managing the rent, bills, the weekly food shop and making sure you don’t annoy each other with pet peeves like drinking the last of the milk or leaving smelly socks lying around.
If you’re going to shack up with someone, do it with your eyes wide open.
With that in mind, there is a new trend that has developed over the past few years, which has seen an increase among unmarried couples wanting to protect their assets and have an exit strategy, should the relationship turn sour.
These contracts are known as ‘cohabitation agreements’.
But what about the romance, we hear you shout? Is this not the equivalent of handing your loved one a prenuptial agreement and effectively saying ‘we’re going to break up one day’?
Perhaps, but perhaps not.
We ask divorce lawyers and other experts to explain the pros and cons of having a cohabitation agreement. Here’s what they told us.
What is a cohabitation agreement and how does it work?
‘Cohabitation agreements are generally entered into between a couple who are not getting married or entering into a civil partnership,’ Renato Labi at the UK divorce law firm, Hughes Fowler Carruthers, tells us.
‘It will not affect the legal nature of their relationship. Cohabitation agreements usually concern the ownership of a property.
‘If you own a flat and your partner is going to move in, a cohabitation agreement can record the fact that, even if the other partner is contributing to household bills or mortgage payments, you both agree that the other partner will acquire no interest in your property.
‘This can spare a separating couple a very expensive argument about whether the person who moved had acquired an interest in the property.’
However, don’t write it up yourself and scrawl it on a piece of paper – if you really want to protect yourself, it’s best to get a lawyer.
‘If the document is prepared properly, and both parties have legal advice and understand what they are doing, then it is likely that they will be bound by the agreement,’ adds Renato.
‘At the very least it will provide powerful evidence of what the parties agreed and understood when they started living together.
‘If one party has been untruthful or put the other under duress to sign the agreement, a cohabitation agreement entered into in those circumstances would be challengeable in court.
‘Cohabitation agreements are not particularly common but, when so many couples live together without being married, they can be a very useful way of avoiding expensive arguments if a relationship ends.’
There’s another reason for why having this conversation with your partner might be awkward: the money chat.
In order for the agreement to be valid, you both have to give full financial disclosure, which means that all your cards will be laid out on the table, including any debt that you might not have opened up to your partner about yet.
Be prepared and if you can, have this talk beforehand so there are no unexpected surprises.
‘They [the agreements] can be valid and legally binding provided they have been entered into with each of the parties having had separate, independent advice as to the implications; where each has provided full and frank financial disclosure to the other, and where there is no suggestion that there is any duress upon either of the parties to enter into such an agreement,’ says Ayşen Soyer, a partner at Wilsons Solicitors with the family team.
‘Moreover, the agreement must be inherently fair to each party. The agreement can be rendered void if one of the components set out above is missing. It is also important to note that parties can never contract out of their financial obligations to their children, and so such a clause is also likely to be rendered void.
‘I do recommend that couples get them; if only for their peace of mind that they are not exposed to potentially losing a share of their assets to their partner if that is not what they both intend to happen.
‘They are common. People are wise to the fact that there is no such thing as a ‘common-law wife or husband’, and so they knowingly and intentionally record their decisions about sharing their money or assets.’
As a whole, the process usually only takes a few days to complete.
However, a cohabitation may still not be binding in court, explains Frank Prior, a partner at Paris Smith solicitors.
‘Where a claim can arise is where one party owns a property and the other claims an interest in it by virtue of a promise or action – and this alone is a compelling reason why a cohabitation agreement is a sound investment.
‘Will it absolutely bind a court? No, but a well-drafted cohabitation agreement will carry so much evidential weight that it would take a very brave judge to stray to far from it.
‘Such claims often centre on anecdotal evidence and half-remembered conversations, so to have an agreement that records precisely what was intended by both parties will often stop even a whiff of a claim in its tracks.’
In addition to protecting property, a cohabitation agreement can also outline payments of household costs, shared money and what would happen to these holdings if the relationship ends.
How to tell your partner you want a cohabitation agreement
So, how do you tell someone you want a cohabitation agreement? It’s not the most romantic discussion, and if you’ve never mentioned having an agreement in place when moving in together, your partner might understandably feel taken aback at the sudden suggestion.
Have the chat in a nice, relaxing space (not in a busy restaurant during a romantic meal) and don’t just blurt it out.
Explain why this could potentially be beneficial to both of you and that it’s not about a lack of trust in your relationship, but make sure to stay open to hearing their thoughts too, explains Ayşen.
‘I think most people are fair-minded and open to an honest discussion about what is to happen to their finances in the event of a relationship breakdown,’ she says.
‘I would just ask my partner how they would feel about documenting our wishes of what should happen if we were to separate.
‘If they are horrified at the prospect, you won’t be able to do it because it is ultimately a consent agreement; but, if you don’t ask you’ll never know!.’
Listen to your partner and try to find a compromise that works for both of you.
And always remember why you wanted to move in with them in the first place – because that is still the most important thing.
MORE: How to plan a Valentine’s date that will actually make your relationship stronger
MORE: What to do if your partner’s parents won’t stop gushing about his or her ex
source https://metro.co.uk/2020/02/17/get-cohabitation-agreement-move-partner-work-12217562/
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