Buying together sounds simple and romantic, but without a solid plan for cost-sharing and what happens if one person wants out, it can get messy.
Many people choose to purchase a home with a partner, friend, or family member. While this step can be exciting, it also comes with risks that are often overlooked. Buying a property is one of the largest financial commitments most people make, and without clear agreements, conflicts can arise quickly. With proper planning, however, you can protect both your investment and your relationship.
Why does planning matter? Buying a home is more than signing documents and moving in. It creates a binding financial and legal commitment that connects both owners in significant ways. If your situation changes, such as one person deciding to move or having financial difficulties, the absence of a plan can turn a simple challenge into a prolonged dispute.
Establishing expectations early reduces stress, protects the property, and gives both parties confidence about how issues will be handled if life takes an unexpected turn.
How should you title the property? The way the property is titled determines what happens if one of the owners passes away.
● With joint tenancy, ownership automatically transfers to the surviving owner, which may be the best option for long-term partners.
● With tenants in common, each person owns a separate share that can be passed on to heirs, offering flexibility for those who want their portion to go to family members.
Choosing the correct title structure from the beginning is critical because changing it later can be complicated and costly.
"Buying a home with someone you’re not married to works best when you set clear agreements on title, money, and exit strategies from the start."
Talk about money early. Finances are often the primary source of tension between co-owners, so it is essential to address them before purchasing the home. Decide who will pay for the down payment, monthly mortgage, property taxes, insurance, and maintenance.
If one person contributes more, those details should be documented so that expectations are clear. Transparency builds trust and prevents misunderstandings that could harm both the investment and the relationship.
Have an exit plan. It may be uncomfortable, but planning for the possibility that one owner wants to leave is important. Discuss options such as selling the property, refinancing to remove one owner from the loan, or arranging for one party to buy out the other.
Establishing timelines for these decisions helps prevent disputes from dragging on and avoids the financial and emotional costs of prolonged conflict.
Get everything in writing. A co-ownership or cohabitation agreement provides a clear framework for managing the property, dividing expenses, and handling an exit. Working with a real estate attorney ensures the deal is legally sound and protects both parties. Having everything in writing eliminates confusion, provides accountability, and gives everyone involved peace of mind.
Open conversations about title, finances, and exit strategies, combined with written agreements, protect your investment and your relationship. By planning, both parties can move forward with confidence, knowing that their interests are safeguarded.
If you would like to discuss your options or review your situation, call me at (562) 316-2915 or email me at [email protected]. I’m here to guide you.
