It seems like a growing trend for people to buy a home prior to marriage or possibly with the intent of never getting married. Divorce can be an awful experience but at least there is a lot of legal precedent about how to resolve home ownership, possession and debts after the divorce. If you are not married, on the other hand, your legal solutions to resolve these issues are much less clear.
I’ve had many people asking for help where their partner has left the home but is still on the title. The one in the home is now stuck with the mortgage, utilities, taxes and insurance costs and can’t sell or refinance the home without getting a deed from their ex-partner. Often the ex-partner simply won’t respond to any request to fix the title or if they do, their offer to relinquish ownership is often unreasonable.
To reduce these risks, it’s best to have a written agreement prior to your purchase. This agreement should talk about your original contribution to any down payment, how you plan to divide costs of ownership while in partnership and finally, what does the ex-partner deserve if they move out. If those arrangements change over time, sign an amendment. It’s always easier to agree on matters like this while times are good. After a split, it’s inevitable that the one leaving will want too much and the one staying will want to offer too little.
Whether you are married or not, it’s also good to know that when you sign a mortgage, you are both on the hook until that mortgage is paid off. The bank will not be a party to any divorce or partnership dispute. This means that even if your divorce says that the husband is now solely responsible for the mortgage, if that husband eventually goes in default, the now ex-wife is still liable for that debt. To confirm a clean break, it’s best to refinance and clarify that now only the person in possession is responsible for the mortgage.
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