Unmarried Persons Buying Real Estate

There are many legal rules which identify what happens to real estate owned by a husband and wife if one of them dies or they divorce, or if judgments or liens are filed against them.

For two or more unmarried people buying real estate together, the rules are not so clear cut. People in this situation -- including unmarried heterosexual couples, gay couples, lesbian couples, and business partners -- should consider making written agreement to identify their rights and duties with regard to the property.

For couples, issues that they may need to be addressed include: will they have equal or unequal shares in the property? Will their ownership shares change over time? Who will pay loan payments, taxes, and insurance? Who, in addition to the couple, can live in the property? If one party wants to sell their ownership interest, when can they require the other member of the couple to make an offer and when can they require that the property be sold to third parties? What rights does the survivor have in the property if one member of the couple dies? If there is a legal dispute, should the party who prevails be allowed to recover their attorneys' fees? If the property is rented, how should rental income and tax deductions be divided?

For business partners, including partnerships, corporations, and limited liability companies, their current documents probably address many of these issues. The documents should be reviewed to be sure they cover the issues which could arise from purchase and operation of the real estate.

The documents required to address these issues can be complicated and should be prepared by, or with the assistance of, an attorney. The parties should also consult their tax advisors to be sure they understand how their tax situation will be affected by owning real estate with people other than their spouse.

For information, see: The Law Office of Mary Anne Vance, P.S.