Breakups 101: Don’t Buy a Home With Your Partner Without a Cohabitation Agreement

I’m sure, as real estate agents, you’ve had clients that are not married but want to buy a home together. Great idea, right? They can build equity, pool their money for the down payment and split monthly expenses. Sounds like a perfect way to afford buying a home. However, life happens…

If your clients are not married and considering buying a home together (boyfriend/girlfriend, brother/sister or life partner) it’s important for them to protect themselves. As an agent, you can do your clients a huge service by suggesting a couple of very important issues your clients should consider. First, your clients should carefully consider how they should take title. Second, your clients should consult with an attorney to draft a Cohabitation Agreement which lays out the structure of their purchase and expectations of their arrangement.

How should your clients take title?

There are three ways your clients can take title to the property:

1. Sole Ownership. Sole ownership is when only one of the parties goes into title. If your client decides to put only one of them on the deed, tell your clients to beware; the party not listed on the deed has no legal right to the property whatsoever. Therefore, the other party can evict him/her at any time. This can sometimes be intentional due to one of the parties’ financial situation, such as a bankruptcy, judgments or tax liens. If that’s the case, a Cohabitation Agreement is essential!

2. Joint Tenancy. Joint tenancy is when both parties go into title and have equal ownership with rights of survivorship. If one dies, their interest in the property automatically passes to the surviving party, upon the filing of an Affidavit of Survivorship and certified copy of the death certificate.

3. Tenants in Common. Tenants in common is when both parties go into title and have equal ownership. However, if one party dies, that party’s share will NOT automatically pass to the surviving party but will go to the deceased party’s estate.

In Minnesota, if the deed does not specify state joint tenants on the face of the deed, title is presumed to be tenants in common. It makes sense for most married couples to go into title as joint tenants vs. tenants in common. In the unfortunate event that one spouse dies, the surviving spouse can avoid going through an expensive probate and remain as 100% owner of the property. However, if your clients are not married, tenants in common is often the preferable choice. With an appropriate Cohabitation Agreement, both parties can feel protected without the expense of costly litigation in the event their relationship turns toxic. If your clients end up getting married, they can always sign a Quit Claim Deed and change their ownership status to joint tenants.


A Cohabitation Agreement is a legal document that is designed for unmarried couples who wish to live together. The agreement allows to evidence the percentage or amount of each party’s contribution to the purchase as well as outline each parties’ responsibility of expenses and improvements. A Cohabitation Agreement can be extremely important if the couple ever part ways or wants to sell the property. It makes it crystal clear as to how sale proceeds will be divided, without a costly legal battle.

Unlike marriages, where each party has legal rights to the division of property, cohabiting parties do not have any legal rights as to the division of property unless an agreement has been entered into. This can be a devastating realization if one of the parties is not on the title and he/she contributed a substantial amount for the purchase.

Trust me when I have say, I have seen it all. Whether it is a boyfriend/ girlfriend breaking up, a brother and sister having a fallout or life partners ending their relationship, owning property together can end badly and be costly for everyone involved. Therefore, the appropriate choice of how to take title and a carefully crafted agreement executed ahead of time can protect everyone’s interest.

As a real estate agent, you can add value to your client’s home buying experience beyond the closing by suggesting a Cohabitation Agreement. In the event their relationship doesn’t go as planned, they will thank you. I won’t be able to fix your client’s relationship, but as an experienced real estate/estate planning attorney, I can advise them of their options and protect them from a costly fallout…. because life happens. Michele Loughrey Tschida 

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