“What part of the house counts as “ours” versus “theirs””?
“Will we all be eating dinner together every night”?
“Who’s going to clean the bathrooms?”.
These are just a handful of questions that you will need to answer if you are considering co-buying a property.
The situation becomes even more complicated if you co-buy a property with your spouse. In these circumstances, a co-ownership agreement must be put in place to comprehensively address the relationships of the parties. In addition to the co-ownership agreement, a marriage contract – a domestic agreement that deals with the treatment of assets not only during the marriage, but also in the event of marriage breakdown – is often recommended.
A co-ownership agreement will breakdown important elements between co-owners, such as: exit strategies; rules and regulations of the home; and, monthly financial obligations of all parties. A marriage contract, on the other hand, will address spouse-specific issues, such as: equalization of your share of the property on separation; and, trust provisions between you and your spouse in the event that one spouse will not be placed on title of the property.
A marriage contract can also address what would happen with your share of the property in the event that you and your spouse have children. For instance, the agreement might include a clause that triggers the sale of your share of the property on the birth of a child; or, provide terms for one spouse to pay the mortgage while the other is on maternity leave. Certain terms of a marriage contract may also impact the co-ownership situation; for example, terms concerning your attendance at meetings in a co-owned house can be modified within a marriage contract to include for your spouse attending a house meeting as your proxy
Therefore, a co-ownership agreement, on its own, may not suffice to address elements that deal with spousal rights and responsibilities in a co-ownership situation. Regardless, keep in mind that your specific circumstances will dictate what approach is best: sometimes a separate marriage contact is a must; in other instances, it may be possible to cover certain elements related to the marriage within the co-ownership agreement, and a separate marriage contract may not be necessary.
The key take-away is this: every situation is different.
Our lawyers at RPL specialize in Co-Ownership agreements. Contact us to get an assessment of your circumstances.
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