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Cohabitation Do’s and Don’ts

Cohabitation Do's and Don'ts

American law traces its roots back through centuries of the old English common law, and through all that time it has given special treatment to married couples. The traditional family unit has always been considered important, but marriage is given great protections while cohabiting partners are often get no special treatment.  After a breakup, a long-time cohabiting partner will often be disappointed that he or she has no right to property owned by the other partner.  To avoid any surprises if things do not work out, here are some actions a cohabiting individual should consider.

Things to do

  • Do keep clear records of your assets.  If the relationship ends and property has to be divided up you need to be able to show what property is yours.  
  • Do make sure you hold joint title to any major property.  Do not make the mistake of pooling your money to buy a car, boat, home or the like and then have that property titled only in your partner’s name.  The partner holding title may well be able to walk away with the property regardless of who actually paid for it.
  • Do make any loans very explicit in writing.  It is easy for a court to treat a transfer of money from one partner to the other as a gift.  If you intend to make a loan that needs to be paid back, you should say so clearly.
  • Do lay out your expectations in writing.  The best way to do this is with a cohabitation or “living together” agreement that will explain what assets you are bringing into the relationship and how you plan to divide them if you split up.

Things to avoid

  • Don’t act like you are married.  Doing things like sharing a last name or attempting to file taxes jointly could work to create some legal bonds that you may not want.  For example, holding yourself out as married could cause you to be deemed to be in a common law marriage.  Also, many states will divide up property if it appears a couple intended to have a marriage-like relationship.
  • Don’t risk your financial independence.  A divorcing spouse can count on property division or even alimony to get the necessary support.  When cohabiting couples break up, those types of protections are not available.  If something goes wrong you will need to be able to fend for yourself, so make sure you keep a backup plan for that sort of circumstance.  
  • Don’t put your partner’s name on anything you want to keep.  Adding a name to the title for “convenience” can wind up costing you half the value of an asset, like your car.  
  • Don’t co-sign anything you are not willing to pay back yourself.  Couples that break up also have to deal with debts, and often they will be left pointing the finger at each other over who will pick up the tab for an expense (like an apartment lease) that each is unable to afford individually.  
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