After a divorce has been finalized, the judge will usually pronounce that the divorce agreement is fair and reasonable, and then make it official with their approval. After approving the divorce settlement, the judge will often say, “You can remarry in 90 days.” A statement that the divorcing couples tend to roll their eyes to, sometimes muttering under their breaths, “That’s the last thing we want right now!” However, fast forward a few years, some couples find themselves in a position where they are in a meaningful relationship with a new partner. This relationship can sometimes linger between not being ready for remarriage and being ready to commit further to the relationship. Choosing to live with someone you are dating after your divorce can benefit you financially in the following ways:
- You will have just one rent or mortgage payment that you are responsible for.
- You will have only one set of utility bills to pay.
- Your property taxes and household insurance obligations will be for one household instead of two.
Living together also offers you an opportunity to test the relationship in real-life conditions without having to worry about the permanency of being married. You are also more likely to grow closer as a couple if you live together. Are you worried about moving in with someone new after your divorce? Do you think you need legal protections in case any important disputes arise during your relationship? Below, we explain why you should consider a co-tenancy agreement.
What Is A Co-Tenancy Agreement?
Whether you are renting with your significant other or thinking of purchasing a new home together (or even if your partner just wants to move in with you), a co-tenancy agreement might be right for you. This legal contract lays out specific ownership interests for each person in the relationship and dictates what happens if the relationship ends. It also states who is responsible when assets need to be fixed or replaced. A co-tenancy agreement can be as detailed as you and your partner want it to be. In fact, you can choose to include the following things and more:
- Which partner is responsible for making the down payment
- Whose name will be on the mortgage
- Who is going to be on the deed
- What happens in the event that someone defaults on the mortgage payment
- What happens if there is a disagreement about when the property should be sold
- What percentage of the profits from selling the home will be split among the partners
- If there will be a right of first refusal before the house can be put on the public market
- The amount of money each partner will contribute to household expenses
- Whether you will use a joint bank account for common financial expenses
- Who the primary bill payer will be
These examples only scratch the surface of all the provisions you can choose to include in your co-tenancy agreement.
Protect Your Interests
Protecting your legal interests with a co-tenancy agreement can be a practical and relatively inexpensive way to add safeguards to your new living arrangement. Creating a co-tenancy agreement also gives you and your significant other a good opportunity to carefully consider how your new household will function. These agreements also take the guess-work out of separating your possessions if your living arrangement doesn’t end up working. In fact, research shows that couples who are comfortable talking about financial matters have an advantage over those who shy away from talking about matters involving money.