The Benefit of Cohabitation Agreements

A cohabitation agreement is an agreement signed by couples that have decided to live together without necessarily marrying each other. This agreement is used to safeguard the legal status of the couple, as the UK Common law doesn’t recognize unmarried couples. It makes sure that each partner is in a legal position to own, sell and distribute properties and also make other financial arrangements. It provides a guideline for finances and asset distribution in case the couple decides to separate.

What Should Be Included In The Agreement?

Even though all cohabitation agreements are different from one another and based on individuals’ circumstances, below are some common factors that should be considered.

Assets owned before moving in:

If a partner owns some property before moving in, the agreement can claim it to be kept separately and prevent it from being claimed by the other. However, if the partner who doesn’t own the property but provides assistance in paying for renovation or mortgages, they can be entitled to claim the property in the future.

Assets acquired after moving in:

If you and your partner purchase property after living together for a few months,  and one of you has it on their name, this would need to be taking care of. Assets purchased and owned jointly as a couple would be subject to division upon separation of the couple.

Inheritance

In case one of the partners dies, the properties aren’t automatically inherited to the other, as the couple isn’t recognized as a “married couple”. You’ll need to draw a will and keep it updated in case you want to leave anything for your partner.

How is it beneficial?

A cohabitation agreement is extremely beneficial to be recognized as a couple if you want to live together and enjoy owning shared assets. It also safeguards the assets of the couple, as they will be getting their fair share of the assets owned, in case of separation. If the couple has children, it also protects their rights and ensures the primary caregiver gets the financial payments for keeping the children. The agreement also reduces conflict between the couple, as they both know what the other is entitled to and what can be the potential consequences of splitting up.

It can also help you save money as initially you’ll be paying for the agreement but later, you’ll be entitled to the shared assets by law and wouldn’t feel financially weak when you break up.

Overall, this agreement gives you a legal status and ensures financial safety in case you and your partner decide to go your own separate ways.

If you’re looking for expert advice from friendly professional solicitors regarding family law, children law, criminal and more, consult with Wembley Solicitors. Get them to answer your queries by reaching out to them.