Property Rights for Unmarried Couples

Some couples who choose to remain unmarried wonder about property rights, particularly if they have lived together for several years. In the state of California, the courts don’t recognize any common marriage law. Cohabitation does, however, present some interesting property considerations. For legal counsel and or advice, contact our team of experienced San Diego family lawyers at Boyd Law.

Do Unmarried Individuals Have Any Automatic Rights to a Partner’s Property?

Generally, an unmarried individual has no right to property that is in his or her partner’s name. In the event of a break up, the property goes to the individual who retains legal ownership. For debt, the individuals listed on the paperwork remain responsible for payment. In other words, if a partner cosigns with the other, they may both share responsibility for debt repayment.

Finding an Alternative: Cohabitation Property Agreements

Unmarried couples, like other individuals, do have an opportunity to create joint ownership with formalized cohabitation property settlements and agreements. A cohabitation property agreement is a legally binding contract that outlines ownership within a defined relationship. Couples can use it to establish information regarding:

  • Property ownership
  • Shared income and expense information
  • The management of financial accounts, including bank accounts, credit accounts, and insurance policies
  • The right to make medical decisions for the other partner
  • The procedure for contract dissolution if the two individuals separate
  • Guardianship rights in the event that one partner becomes disabled

An unmarried couple may want to pursue this type of agreement to protect assets and individual property rights when purchasing a new home together. If you include a home on the property agreement, remember to include the following:

  • The terms of ownership listings. Couples can choose to assign rights so that a partner will assume ownership of the home in the event of death or that a portion of the home will transfer to someone named in a will.
  • Ownership transference. A couple needs to determine equity and buyout rights. For instance, if one partner can secure more equity by paying more or investing in renovations, those terms need to be outlined. For a buyout, the couple needs to agree on appraisal and payment terms.
  • The terms of a separation. The agreement should outline who will receive what in the event of a breakup.

While the cohabitation property agreement is legally binding, it doesn’t afford couples the same rights and privileges as married couples. Unmarried couples must still file taxes independently (taking the terms of the contract into consideration), and unmarried couples can only pursue compensation based on the terms of the contract. They don’t have access to any type of financial support or “palimony” after a breakup. In the event of death, the property agreement and/or a will or living trust will determine which assets a surviving partner receives.

Why Consider Creating a Cohabitation Property Agreement?

Like a prenuptial or postnuptial agreement, cohabitation property agreements don’t mean that you expect to break up. They do, however, afford each party protection in the event of a separation. You may want to consider creating a property settlement or agreement to:

  • Clearly define the terms of financial obligations. Property disagreements can lead to or worsen tension in a relationship. Understanding the terms from the outset can give partners peace of mind and help resolve future disputes.
  • Ensure that property remains in the right hands. A property agreement remains helpful even if an unmarried couple never separates. In the event of death, a property agreement clearly defines survivorship rights.
  • Provide flexible, specific terms for an unmarried relationship. Couples who don’t want to marry can enjoy many of the same rights as married couples by creating a cohabitation property agreement.

In the absence of a law that affords unmarried couples property rights, cohabitation property agreements create a set of contractual rights for individual circumstances. For more information about creating a property agreement, contact Boyd Law. The Boyd Law San Diego divorce attorneys have extensive experience successfully practicing divorce and family law cases throughout all of California.