Cohabitation Agreement Required?

Mark_84 · 28 September 2021 at 10:13AM

I currently own my own house with a mortgage with a lot of equity. I have previously been through a divorce and I am now seeing someone new.
We have discussed moving in to my house together but I don’t want to end up putting my house at risk if we breakup in the future.
Is it worth getting a legal agreement setup ?
Would she only have rights if she contributed towards the mortgage? Or would this also apply if she contributed only towards bills?
She has her own house and is planning on keeping it whilst we try the living together idea. I guess I just don’t want things to get complicated financially if it doesn’t work out?

Mimi_Arc_en_ciel · 28 September 2021 at 1:23PM

I checked this out as I have the same situation. My solicitor informed me that:

"Providing they do not contribute to mortgage or anything structural to the property then they do not have a claim. You can however charge them for the bills and ask for contributions towards decorating, similar to what you would do in a rental property"

gwynlas · 28 September 2021 at 3:12PM

You pay for your house she pays for hers. She contributes to bills eg increased council tax half utilities etc. Are you on similar salaries or will she be financially better off than you by earning rental on her property?
You both need to contribute to additional expenses in relation to your income.

maman · 28 September 2021 at 3:19PM

gwynlas said:

You pay for your house she pays for hers. She contributes to bills eg increased council tax half utilities etc. Are you on similar salaries or will she be financially better off than you by earning rental on her property?
You both need to contribute to additional expenses in relation to your income.

Mimi_Arc_en_ciel said:

I checked this out as I have the same situation. My solicitor informed me that:

"Providing they do not contribute to mortgage or anything structural to the property then they do not have a claim. You can however_ charge them for the bills and ask for contributions towards decorating, similar to what you would do in a rental property"

There's an important difference between these two responses which could be confusing.

What @Mimi_Arc_en_ciel says is reporting the legal position from a solicitor.

What @gwynlas posted is an opinion, presumably based on how he'd choose to handle personal finances in your situation.

Mark_84 · 28 September 2021 at 6:10PM

Mimi_Arc_en_ciel said:

I checked this out as I have the same situation. My solicitor informed me that:

"Providing they do not contribute to mortgage or anything structural to the property then they do not have a claim. You can however charge them for the bills and ask for contributions towards decorating, similar to what you would do in a rental property"

Thanks, I have a free initial appointment with a solicitor tomorrow. This would probably be sufficient for now as she wouldn’t be contributing to the mortgage yet. Obviously things may change in the future if she sells her house and starts contributing to the mortgage here. At this point I would probably have to get something in writing.

Mark_84 · 28 September 2021 at 6:16PM

gwynlas said:

You pay for your house she pays for hers. She contributes to bills eg increased council tax half utilities etc. Are you on similar salaries or will she be financially better off than you by earning rental on her property?
You both need to contribute to additional expenses in relation to your income.

She isn’t working full time at the moment as she is a full time student. I will be earning a lot more obviously at the moment due to this. Council tax shouldn’t be unaffected due to her being a student so still single occupancy.
It was my thoughts for her to contribute to bills and food etc as long as no claim could be made on the house for now. We can then look at the bigger picture when she starts contributing to the mortgage.

CIS · 28 September 2021 at 8:16PM

Mark_84 said:

gwynlas said:

You pay for your house she pays for hers. She contributes to bills eg increased council tax half utilities etc. Are you on similar salaries or will she be financially better off than you by earning rental on her property?
You both need to contribute to additional expenses in relation to your income.

She isn’t working full time at the moment as she is a full time student. I will be earning a lot more obviously at the moment due to this. Council tax shouldn’t be unaffected due to her being a student so still single occupancy.
It was my thoughts for her to contribute to bills and food etc as long as no claim could be made on the house for now. We can then look at the bigger picture when she starts contributing to the mortgage.

If she moves in with you as her 'sole or main residence' you still need to advise the council. Although you're entitled to a 25% discount if she's a full time student it's not single occupancy and so the change in situation needs to be reported.

sassyblue · 29 September 2021 at 12:37PM

yes if you tell her she’ll be contributing towards your mortgage she’d have a claim. Similarly if she does anything to the property that improves its value.

if in doubt get a cohab agreement

TBagpuss · 6 October 2021 at 4:25PM

I'd recommend getting an agreement in place - it means that the two of you need to discuss your expectations and assumptions so tends to mean that the risk of any disagreement in future is much lower.

She would not automatically have a claim against the property but of course if you move in together then things can get blurry as to what was agreed or the basis on which she contributed. Paying bills can be seen as a contribution that frees up your money to pay the mortgage, so has little difference to paying towards the mortgage.

An agreement can explicitly say that any payments she may make WILL NOT result in an interest in the house unless there is a an explicit written agreement to say that they will, which avoids any confusion o- and of course it scan cover the same ground for her property , so she is protected as well.

If you have an agreement, it's sensible to review and update it periodically, and when there is any major change in your circumstances (for instance, if one of you sold t property, if you had any children, etc)