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Cohabitation Agreement – What Is It & Are They Legally Binding?

In the UK, a cohabitation agreement records financial arrangements, property rights, and separation terms for unmarried couples. It is a legal document that clarifies joint liabilities, financial support, and shared responsibilities, helping avoid financial disputes during a relationship breakdown.

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    In this guide to cohabitation agreements, we answer common questions on cohabitation laws and help you understand whether you really need one.

    More couples are choosing to live together without legally recognising their relationship through marriage or civil partnership than ever before, with 3.6m couples cohabiting in the UK in 2022.

    However, far too many of these couples believe in the idea of “common law marriage”. This is unfortunately a myth and it offers unmarried partners no legal rights upon separation.

    Although living together as unmarried partners may seem no different from living together as married partners or civil partners, your respective legal rights are markedly different when it comes to separating if things do not work out as planned.

    Therefore, if you separate from your partner, you have limited or no rights to property, pensions, savings, and so on. If you’re moving in with your partner or thinking of starting a family, it’s wise to seek legal advice from a family law solicitor to understand your rights.

    Why Unmarried Couples Should Get a Cohabitation Agreement

    1. Provide Financial Security and Clarity – Unmarried partners often share significant assets, such as property, savings, and other investments. A cohabitation agreement clearly outlines the ownership and division of these assets, protecting both parties in the event of a separation. For instance, if a couple purchases a house together, the agreement can specify each partner’s financial contribution and how the property will be divided should the relationship end.
    2. Outline Financial Arrangements & Obligations – Cohabiting couples may share financial responsibilities such as paying the mortgage, household expenses, and other debts. A cohabitation agreement can detail how these financial obligations will be managed, specifying each partner’s contributions.
    3. Child Custody and Financial Support – For couples with children, a cohabitation agreement can include provisions for child custody and financial support, such as maintenance agreements. This ensures that the children’s needs are prioritised and that both parents know their responsibilities. It can detail how custody will be shared and how expenses related to the children’s upbringing, education, and healthcare will be managed.
    4. Management of Debts – In the absence of a cohabitation agreement, one partner could potentially be held responsible for the other’s debts. By specifying how debts will be handled, the agreement protects each partner from being unfairly burdened by the other’s financial liabilities. This is especially important if one partner enters the relationship with significant debt.

    Imagine a couple deciding to purchase a property together. Without a relationship agreement, financial disputes could arise regarding who owns what percentage of the property and who is responsible for the mortgage. A cohabitation contract outlines each partner’s ownership share and financial responsibilities, preventing potential disputes.

    When purchasing a house together, it’s vital to define the ownership of the property. Clearly defining who holds the title ownership of assets such as vehicles and property can prevent financial disputes and ensure a fair division of assets.

    When purchasing a property together, it’s vital to define the ownership of the property. Clearly defining who holds the title ownership of assets can prevent financial disputes and ensure a fair division of assets.

    Living together involves many shared responsibilities, from household chores to managing joint liabilities. A cohabitation agreement details these shared responsibilities, ensuring that individuals contribute fairly to the household.

    Cohabitation Agreement FAQ’s…

    1.Is a cohabitation agreement legally binding in the UK?

    Strictly speaking, cohabitation agreements are not legally binding in England or Wales in the sense that courts must uphold them, but in a similar way to prenuptial agreements, the courts will consider them as part of any application when they are drafted and executed properly.

    Therefore, a cohabitation agreement or living together agreement is a legally binding contract provided you obtain legal advice before preparing the agreement and it is signed as a deed.

    2.What financial arrangements can you include? e.g. property

    There is a range of financial issues and clauses that can be included in a cohabitation agreement, here are some of the essential points

    1. Property Ownership: When purchasing a house together, it’s vital to define the ownership of the property. Clearly defining who holds the title ownership of assets such as vehicles and property can prevent financial disputes and ensure a fair division of assets.
    2. Gifts: Specify how gifts exchanged between you or received from others will be treated. This can prevent disputes over valuable or sentimental gifts.
    3. Inheritances: Decide how inheritances or unexpected financial windfalls will be managed. This includes whether they will be kept separate or shared.
    4. Joint Accounts: Address the establishment and operation of joint financial accounts, such as bank accounts or savings accounts. Detail how contributions and withdrawals will be managed.
    5. Debts: Clarify how existing and future debts will be handled. This may include setting out who is responsible for which debts and how they will be paid off.
    6. Household Expenses: Determine how everyday living expenses, such as rent or mortgage payments, utilities, and groceries, will be covered. Specify the contribution of each party.
    7. Sale of Property: Plan for the possibility of selling property or assets. Specify how the proceeds will be divided and what steps will be taken in the event of a sale.
    8. Support for Children: If you have children together, outline the financial support and care arrangements for them during your cohabitation or in case of separation.
    9. Pet Care: Determine who will be responsible for the care and expenses related to pets during your cohabitation or in case the relationship ends.
    10. Death and Benefits: Address what happens in the event of death, including nominations for pension and death in service benefits or life insurance. This can help ensure that the surviving partner is taken care of financially.

    The best way to specify any intentions regarding the distribution of assets following one’s death is best dealt with by drawing up a will.

    Once the agreement is in place, it should be reviewed at regular intervals, especially if there have been any significant life events such as the birth of a child.

    3.Is an online cohabitation agreement template legal?

    In simple terms, an online cohabitation template can be used by people who are living together and want to protect their money and assets.

    However, a basic template isn’t going to include specific legal clauses on property or asset division.

    For example, if you want to establish property rights upon separation, you’ll need family law solicitors to draft the cohabitation agreement for you.

    This document can then stand up in court and protect unmarried partners from future claims.

    4.Do you need a solicitor to draft a living together agreement?

    When it comes to living together contracts, it’s not a legal requirement to instruct a family law solicitor. In saying that, only legal professionals can draft specific legal clauses, e.g. ownership of property, entitlement to future inheritance, etc.

    Do you want to run the risk of having a Judge discard your contract if you need to enforce it because you tried to do it yourself using a template? Or worse, mistakenly draft a clause that entitles your former partner to more assets than you agreed.

    5.Can you draft your own agreement with your partner?

    The straightforward answer is yes, you can draw up your living together agreement or cohabitation agreement without a solicitor.

    However, the more important question is “Should you draft a legal contract yourself?”

    You need to be aware that cohabitation agreements are only legally binding if they are drafted correctly and include specific legal clauses whilst also meeting certain pre-contract conditions.

    Ultimately, if you want a robust agreement that is likely to be upheld in court then you are well advised to instruct a cohabitation solicitor to help draft the agreement for you.

    Can You Draft Your Own Cohabitation Agreement?

    6.Do cohabitation contracts still stand if you get married?

    This depends on your specific agreement. If elements of the agreement are not highlighted but are essential to your relationship after marriage, you should instruct a solicitor to help you.

    Most family law solicitors will advise you to draft a prenuptial agreement instead of a cohabitation agreement as prenups can be more specific with regards to property, debts, inheritance, and other types of assets.

    7.Can I get a cohabitation agreement if we want to get married in the future?

    Yes, unmarried couples in the UK can still enter into a cohabitation agreement if they plan to get married in the future. A cohabitation agreement provides legal protection over finances for couples living together, regardless of their future marital status.

    Cohabitation Agreement Service for £599 – Fixed Fee

    A Cohabitation Agreement allows unmarried couples living together to set out their intentions regarding the division of finances and assets upon separation. Our solicitors will prepare this for you for a fraction of the cost of a local family law firm.

    What are the benefits of a cohabitation agreement?

    The primary benefit of a cohabitation agreement is to provide clarity to both parties over what the future arrangements look like for owned & shared assets, debts, and responsibilities.

    One of the main advantages of a cohabitation agreement is that it allows couples to define their own terms and protect their individual interests. Without such an agreement, couples may be subject to the default laws of their jurisdiction, which may not align with their intentions and desires.

    It is important to note that while a cohabitation agreement provides a degree of legal protection, it may not be legally binding in all jurisdictions.

    Furthermore, an agreement helps reduce the chances of couples ending up resenting each other should the worst happen, and they break up.

    Key benefits of a cohabitation agreement include:

    • Prevents future disagreements by establishing an entitlement – making an agreement can prevent emotional or irrational decisions immediately after a breakup.
    • Provides both parties with clarity if the relationship does not work out as planned – who owns the house, who pays what bills and what happens to joint bank accounts or pensions etc. (how are savings and jointly owned assets distributed).
    • Protects yours and your children’s future – what are the financial responsibilities towards each other, arrangements for children in the event one party becomes ill and can’t work or even dies (can also include next of kin rights).
    • Can save money – by establishing an entitlement from the outset and providing clarity there is less chance of requiring legal advice or action in the future.

    Is a living together agreement a good idea for unmarried partners?

    There are various reasons why you may be considering a cohabitation contract, but here are some of the most common scenarios:

    • You’re moving in together for the first time –It can lay out what the rights are for both parties in regards to property ownership.
    • You’re planning to start a family – If you have children and start a family, it’s important to establish rights to property and assets.
    • One party has no intention to get married –You may wish for some legal protection if you never plan to get married.
    • One party already owns a property –If you want clarity on what is to happen with it if you have moved in or are going to be moving in. This can help stop claims in the future for a beneficial interest in a property.
    • If there is a clear disparity in wealth –You want to document who owns what or how assets will be divided if you break up or if one partner dies.

    Ultimately, a living together agreement can help alleviate potential disputes and ensure a fair and equitable resolution.

    The key components of a cohabitation agreement typically include:

    1. Financial Responsibilities: This section outlines how the couple will manage their expenses and financial obligations during their cohabitation. It may include details such as how they will split rent, utilities, groceries, and other shared expenses.

    2. Property Ownership: If the couple owns any property together, such as a house or a car, the agreement will specify how the ownership will be divided or how the proceeds will be shared in case of a breakup.

    3. Debt Allocation: Similar to property ownership, the agreement will address how any shared debts, such as loans or credit card balances, will be divided between the partners.

    I’m cohabiting with my partner, what is the current law on cohabitation?

    At present, there is no precise legal definition of what a cohabiting couple is, but a cohabiting couple is generally regarded as two people in a relationship of the opposite sex or same sex who are not married or in a civil partnership and who form a living arrangement in the same household.

    In simple terms, an unmarried couple who live together.

    Many cohabiting couples assume that they will be protected under ‘Common Law’ after a long period of cohabitation and that they will be entitled to claim a share of their partner’s assets if they separate.

    Unfortunately, this is simply not the case.

    The current law states that cohabiting couples must divide their jointly owned assets if they separate, but any individual assets such as pensions, savings, and investments including property will not be divided.

    As a result, when it comes to cohabitation rights, the current law allows cohabiting couples fewer rights on separation or death than is given to civil partners or married couples.

    This situation can leave some people who choose to cohabit in a vulnerable position, especially those who choose to stop working to raise a family while their partner has a career and builds up a pension and savings in their name.

    If the relationship does not work out and the couple separates, the ‘stay-at-home’ partner will not be entitled to a share of their partner’s sole assets.

    What are the rights of unmarried cohabiting couples?

    Cohabiting couples now represent nearly 1 in 5 of all couples that live together.

    Although cohabitation is common practice in the UK with 3.6m couples cohabiting, there is still confusion about the legal rights and responsibilities of cohabitation compared to marriage or civil partnership.

    At the Labour Party Conference, they announced that they would look to reform the existing laws for cohabiting couples. The new laws for cohabiting couples could see cohabitees gain more legal rights.

    Cohabitating couples do have the same legal protection in areas such as domestic abuse, but cohabitation gives no legal status to a couple in the same way as it does in a marriage or civil partnership when it comes to financial matters.

    Sadly, many people are still unaware of this and believe in the myth of common-law marriage.

    Rights For Unmarried Couples Upon Separation Explained

    How much does a Cohabitation Agreement cost?

    Cohabitation agreements can vary in cost depending on how you go about obtaining one.

    The cost of a cohabitation agreement to be drafted by solicitors will range from £599 to £3,000 depending on the complexity of your agreement and where you live.

    Our Cohabitation Solicitors can help you save thousands in legal fees by assisting you for just £599 fixed fee.

    How long does it take to draft a Cohabitation Agreement?

    This depends on a couple of factors. Firstly, are you going to get assistance from a family law solicitor or attempt to do it yourself?

    Secondly, how complex your agreement is and how efficient you can be with providing all relevant information.

    With that being said, you should be able to have a professionally drafted cohabitation agreement within 28 working days.

    Is a Cohabitation Agreement likely to stand up in court?

    Legal contracts are enforceable, but only if they meet certain conditions.

    Both parties should be aware of what they are signing, which means that both people need to have independent legal advice.

    The cohabitation agreement should be professionally drafted by a family law solicitor and amended until both parties are happy with the agreement.

    Don’t risk using a free template from Google as it could end up costing you in the future.

    Cohabitation Agreement Service for £599 – Fixed Fee

    A Cohabitation Agreement allows unmarried couples living together to set out their intentions regarding the division of finances and assets upon separation. Our solicitors will prepare this for you for a fraction of the cost of a local family law firm.

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