Planning to buy a home is a big investment for anyone. When a couple decides to do it together, the endeavor can be quite complicated. This is true whether a couple is married or in a common-law relationship. If the couple decides to end their marriage or relationship, things can become even more complex. Taking certain steps before buying a house could make a split easier should it occur.
If possible, it may be best to have only one individual seek a mortgage. This could also result in only that individual’s name appearing on the title of the loan though it may be possible for someone to instead act as a guarantor of that loan. Should the relationship later fail, this approach could make it easier to handle the asset.
When the property purchased by the couple is an investment property, upon ending the relationship they may opt to maintain the status quo. Issues with this approach could arise should one or both parties decide they want to move on and secure a new mortgage. In addition, any creditors or lenders will consider anyone on the mortgage as a full owner, responsible for 100 percent of the payments should either party default, as opposed to a part-owner.
The creation of a separation agreement is a key part of any relationship ending. Included in this agreement will be the way in which the interest in the home will be divided. This is true whether the home is sold or one individual opts to stay in it. In the latter instance, the person who wants to keep the home will likely have to pay the other person the equity in the house to which they are entitled.
Regardless of how someone wants to address a house in a split, it is important they are aware of all of their options. A lawyer that helps married and common-law couples seeking to end their relationship can be of assistance.