In Massachusetts, where I have been practicing real estate law for more than 40 years, many unmarried couples purchase real estate together. Some engaged people are trying to take advantage of the current low interest rates, and market indecision, to get something "we own before we marry". Other couples, whio never intend to marry, have the inclination to pool their assets to make joint ownership a part of their personal relationship.
When I assist people in purchases who are in this situation, I explain to them their two ownership options; tenancies in common and joint owners with right of survivorship. Only the extremely practical even consider tenancies in common, whereby at the death of one of the owners, his or her undivided one half interest in the property passes to the person's estate. Almost everyone chooses "joint ownership with right of survivorship" I might add that in each of these situations, I strongly suggest that the parties enter into Tenancy In Common Agreements or Joint Ownership Agreements to provide in advance for the possibility that they may part company from each other while owning the property in both names.
Very few clients are willing to enter into the Agreements I outline above. I may write a future post on what terms and conditions these documents contain. In any event, most couple says "No", so when a couple breaks up, the "fun" really starts. One party moves out, and says "why should she continue to make the mortgage payments, I no longer live here". And "by the way, I put down most of the down payment, and I want my money back, NOW" "I will only pay the mortgage payment if I can claim ALL the deductions on my tax return." "I will not sign for a refinancing, even at better rates, unless you buy me out on my terms" "OK, if you have moved out, I am changing the locks, and you cannot have access to the property" I can honestly tell you I have heard all these statements and more.
There is a judicial solution for these situations. It is called a "Petition for Partition" and it is an equitable proceeding, wherein all the factors involving the Tenancy are examined. It is not cheap!!! It is not fast!! It rarely reaches a conclusion that addresses all the concerns of the parties!!!
When you, as real estate professionals, see an unmarried couple buying real estate, urge them to enter into some kind of "exit strategy" agreement. It is truly for their own good. A failure to have something in place can only exacerbate the drama of the break up. This piece of advice could be the single most important thing you do for these customers; they will thank you somewhere down the line. Topkins & Bevans are there to help, if any of your customers wish to discuss this entirely sensible, and prudent, strategy.
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