Considering purchasing a home with a partner? Proceed with caution. While many partnership purchases continue in peaceful harmony; many more do not.
The most common type of partnership for home ownership is when two or more people jointly purchase a home and live together in the property. Most often the transaction involves two people who are also romantically partnered. While the idea sounds good up front—we all know that relationships never go sour—it can be a nightmare for those who decide to part company. There can be differences on how bills are to be shared, which repairs are needed, and who is responsible for payment. There may also be sleeping or noise problems, issues regarding cleanliness, the assignment of chores, etc. Sometimes the best of friends become enemies for life over such differences.
If you are considering purchasing a home with a partner, make a list of all the possible areas for disagreement and put them in writing. Spell out everything, even those things that may seem trivial at the time. It’s better to list more potential problems than necessary than to omit what might become a major problem later. And for those who are concerned that listing problem areas may incite disharmony, I’d suggest that it’s better that it be discovered before the purchase than afterwards.
Structuring a partnership agreement isn’t as simple as placing both names on a deed. It’s better to hire an attorney to draw up the agreement and to put EVERYTHING, percentages of ownership, responsibility for mortgage payments, utilities, taxes, insurance, etc., or any other important stipulations, in writing. A carefully considered and properly structured partnerships provides both insurance against future disasters and peace of mind that the “bases are covered.” Remember, the best of relationships can go sour; don’t run the risk of losing your money too.