What Is a Co-Ownership Agreement and Why Is It Important?
Even though married couples have certain guaranteed protections under the law (such as rights to all jointly-held property upon the death of a spouse), many long-term couples elect not to marry. This means that if the relationship ends for any reason, they may not be fully protected when it comes to determining ownership of jointly-held property.
Protect Your Property in a Domestic Relationship
For this reason, it’s important if you are in a long-term relationship with jointly-owned property that you take precautions to protect yourself in the event of separation or death. Of course, no one likes to think about negative outcomes, but it can be useful to meet with a family law attorney who specializes in the laws surrounding domestic partnerships. By taking preventative measures now, you could be protecting yourself and your partner from difficult and expensive litigation in the future.
When an unmarried couple separates, or one of the partners dies, how that person’s property is handled depends on the following:
- Were they registered as domestic partners, and where and when did the registration occur?
- When was the property obtained and when did the relationship begin?
- Who paid for the purchase, maintenance, and repair of the property?
- What does the title to the property say about ownership?
- Is there a written agreement regarding the property between the partners or, in the case of death, is there a will indicating what to do with the property?
Options for Co-Ownership
There are several different options for the co-ownership of property. One agreement is known as “tenants in common.” With this form of ownership, each individual co-owner possesses an undivided interest in the property. That means that each one has rights to any portion of the property, and no one has the right to exclude other co-owners from any portion of the property. With this type of agreement, upon the death of one of the co-owners, the property is transferred to his or her heir(s). This means that no one has the right of survivorship. Additionally, a tenant in common has the ability to sell interest in the property without consulting the other co-owners.
In contrast, a joint tenancy (with right of survivorship) agreement means that when one co-owner dies, the property is transferred to the other co-owner(s) automatically. This is an especially good ownership agreement for couples in domestic unions who want to protect themselves in the event of tragic circumstances, such as the death of one of the partners. This type of ownership agreement can also be terminated early if necessary.
It is critically important if you are in a long-term relationship or a domestic partnership that you protect yourselves by getting written agreements regarding all jointly-held property. Sheryl R. Rentz is an experienced family law attorney in Montgomery County with extensive knowledge of Pennsylvania’s financial and tax issues. Whether you are in a stable relationship or your relationship is already coming to an end, our law office can help put an agreement in place, or help protect your rights and your property in the event that you don’t have one. Call (866) 290-9292 today and schedule a free consultation.