Part II: Domestic Partner or Cohabitation Agreements – Questions to Consider

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By Maureen Cohon, Esq.

Clients who contact us after deciding to terminate their partnership most often find parting less stressful if there is a signed domestic partnership or cohabitation agreement. After all, agreeing on property issues is a lot harder when the enchantment is lost. If you have ever ended a relationship or seen friends who have ended their relationships, you may better understand why a domestic partner agreement is important.

If you still have doubts about the importance of this agreement, consider the following:

Living Together
If you are living with someone, this agreement will let each of you know what the other expects out of the living arrangements. Consider discussing the following with your partner:

  1. What will we each contribute to living expenses, mortgage, utilities, entertainment, real estate taxes, homeowners or renters insurance and other items relating to our place of residence or any other shared property?
  2. Do we have – or will we open – joint banking or checking accounts, joint credit cards, or investment accounts? There are pros and cons to having these accounts since each partner has no control of the others access to the funds. Joint credit card accounts allow both partners to use the card and both partners are responsibilities for payment. Before opening such accounts, ask these questions:
    • Do you really need joint accounts? Maybe you would want a joint account for only household purchases and separate accounts for credit card purchases or paying for personal items. If you have or want joint accounts of any kind, you may want to have both signatures for any withdrawals over a certain amount.
    • If you and your partner decide to go separate ways, how will you split the accounts?

Are there children living with you or do you plan on having children together? There are many times when children may be visiting or living in the home. What are the responsibilities of the nonparent? Are you and your partner thinking of adopting? Will one partner carry the baby and the other partner adopt after birth? Are you considering a surrogate or anonymous or known sperm or egg donor?

There are many ways to have children and each situation is different. There are so many issues to consider both before and after bringing a child into a family. Each of the above situations has different issues involved and the couple should talk to someone, such as an attorney experienced in adoptions and related issues, to create a written agreement that outlines parenting expectations.

For example, after the baby is born and before any adoption, you may want an agreement that states your wish for your partner to adopt the baby. Until the time of the adoption she/he will share responsibilities for the baby and be the guardian. This is important because if something happens to the adoptive or birth parent, the Court and relatives know your wishes regarding your child. Or, if a second parent adoption is not allowed in your state , you may want to have a document stating that you want your partner to adopt your baby at the time such adoption is allowed but be the child’s guardian until such adoption.

Home Ownership
Is the home you live in titled in one partner’s name? You may want to define the following:

  1. Did the non-owner partner contribute money to the purchase of the home?
  2.  Does the non-owner pay any amounts to the mortgage for the property you are living in?
  3. What about for improvements on the home?
  4. Do these payments give the non-owner partner any ownership interests in the home?

Is the home or other real estate property owned jointly?

  1. Did each partner share the down payment and settlement costs equally and/or share the mortgage payments equally?
  2. If you sell the home, how will the equity be distributed? Will it be in proportion to the amount paid on the home by each, equally or some other way? How do you determine the value of the house? How soon does it have to go on the market?
  3. If you separate, who will have the right of refusal to purchase the home? In what amount of time?
  4. If one partner moves out, will that partner have to continue to contribute to the cost of the home?

Other Property
Do you each have property in the home that you intend to share? Do you want the property to remain yours after a termination?

This “separate property” could include family heirlooms or inherited property or property that just has sentimental value to you. Most couples have such property and agree that it belongs to the original owner.

What would happen if the relationship no longer works for you or your partner?

If you have a domestic partner or cohabitation agreement most of the above issues, which could cause problems, would be covered. Parting will still be painful but the agreement will be determined by you before the separation. The agreement should address:

  • How the notice of termination is given to each other
  • The time limits for the purchase or sale of the home and the distribution of the equity if it is a joint ownership
  • Distribution of your joint accounts
  • Children
  • Any other issues that you determine you want in the agreement

Each couple is different and this agreement is tailored to the couple’s needs. There are many issues that we can address in an agreement, but I think the above are good discussion starters.

While agreements are not easy to talk about, it is better to talk while you are feeling more generous than at the end of a relationship. Of course, the best outcome would be to create and sign the agreement and then put it in a safe place and never have to look at it again!

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