Moving In With a Partner Who Owns a House – 12 Point Checklist

When moving in with a partner who owns a house or has a mortgage, there are several important considerations to keep in mind.

Firstly, it’s essential to discuss how household expenses, including mortgage payments, will be divided.

Will you contribute to the mortgage, and if so, how will this affect your equity in the property?

It’s important to understand that without legal documentation, such as a cohabitation agreement or a declaration of trust, you may not be entitled to any ownership of the property, despite contributing financially.

Consider the legal implications of your contributions. If you’re paying towards the mortgage, it’s akin to paying rent unless you have an agreement that specifies your payments are building equity for you in the home. Without your name on the deed, you’re not legally recognised as a co-owner.

Discuss what would happen if your relationship were to end or if one of you were to pass away.

It’s a sensitive topic but planning for all possibilities can prevent misunderstandings and legal complications later on. You might want to consider life insurance policies where you can name each other as beneficiaries.

Additionally, it’s wise to maintain open communication about each other’s financial situations. This includes being transparent about debts, income, and credit scores, as these can all impact your ability to manage the mortgage and other shared financial responsibilities.

Here are some key points you should be aware of before moving in with your partner who owns a house or has a mortgage:

1. Understand the Legal Ownership

If your partner owns the property and the mortgage is in their name, they are the legal owners. Your move-in does not automatically grant you ownership rights to the property.

Remember, the rights of married couples upon separation are markedly different to those cohabiting, and no, there is no such thing as a common law marriage.

2. Discuss Financial Contributions

Have a clear conversation about how you will contribute to the household expenses.

Will you pay the rent? Will you help with the mortgage payments? How will you divide utility bills, property taxes, maintenance costs, and other expenses?

3. Consider a Cohabitation Agreement

A cohabitation agreement is a legal document that can outline the financial arrangements and what would happen to your contributions if the relationship were to end. It can also cover other shared assets and responsibilities.

4. Impact on Mortgage Interest Deduction

If your partner is claiming a mortgage interest deduction on their taxes, adding your name to the mortgage could affect this.

Consult with a tax professional to understand any potential tax implications.

5. Adding Your Name to the Mortgage

If you decide you want to share the responsibility of the mortgage, you would need to refinance the mortgage to add your name.

This process involves credit checks and may affect the mortgage terms and interest rate.

6. Adding Your Name to the Title

If you want to have ownership rights, you would need to have your name added to the property’s title.

This can be complex and may require the consent of the mortgage lender, as well as potential tax implications.

7. Effect on Credit Scores

If you are added to the mortgage, the payment history will impact both your credit scores. Make sure you’re both comfortable with the shared responsibility and the potential risks.

8. Living Arrangements if Relationship Ends

Consider what would happen if the relationship ends. If you’re not on the title or mortgage, you may have fewer rights regarding the property.

A cohabitation agreement can help outline what would happen in this scenario.

9. Estate Planning Considerations

Discuss what would happen to the property if your partner passes away.

If you want the right to remain in the home, your partner may need to include specific instructions in their will or consider other estate planning tools.

10. Insurance

Make sure you have appropriate insurance coverage. You might need to be added to the homeowner’s insurance policy as an additional insured, or you may want to obtain renters insurance to cover your personal belongings and liability.

11. Household Responsibilities

Clarify who is responsible for maintenance, repairs, and improvements to the property.

If you contribute to significant improvements, discuss how this will be reflected in terms of investment in the property.

12. Seek Legal Advice

Before making any significant decisions or changes to the mortgage or property title, it’s wise to seek legal advice.

A lawyer can help you understand your cohabitation rights and options, and assist in drafting any necessary legal documents.

By addressing these points before moving in with your partner who has a mortgage, you and your partner can help ensure a smoother transition to cohabitating and protect both of your interests in the process.

I’ve got a mortgage. When my partner moves in, should he/she pay?

If you own your property with a mortgage and your partner is moving in there are often many questions homeowners have.

For example, when it comes to contributions towards living expenses or charging rent towards the mortgage, what’s the right thing to do?

Whilst you’re living together as a cohabiting couple a common scenario would see general bills (utilities & food) split 50/50.

The homeowner would continue to pay the mortgage in its entirety to keep things simple. In this scenario, if the relationship breaks down there will be no messy split up trying to work out who owns how much of the house.

Of course, if you happen to get married or enter a civil partnership later on, you can reconsider arrangements and enter specific legal contracts to outline how the property you own before marriage would be considered if you get divorced.

Is your partner moving into your property? Here’s what you need to do

Consider consulting with a legal professional to create a cohabitation agreement that clearly outlines each person’s rights and responsibilities.

This can provide a clear framework for your financial arrangement and offer protection for both parties.

Moving in with a partner who has a mortgage can be a seamless transition if you approach it with careful planning, open communication, and a clear understanding of the financial and legal aspects involved.