Buying a Vancouver House or Condo as an Unmarried Couple – Consult with Bruce Coleman, Vancouver Mortgage Broker
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Buying a Vancouver House or Condo as an Unmarried Couple
On average, many couples these days prefer not to marry or put it off until they’re sure. More and more these days, unmarried couples are choosing to buy a home or condo together with the idea that they should rightfully reap the benefits of a real estate investment.
It’s a great idea and a reflection of modern times, but there are also some dire legal and economic pitfalls you should be very clear about before you take the real estate lunge as an unmarried couple.
As an unmarried couple you might be getting along terrifically at the moment but you also need to ask yourself – “What happens if our relationship falls apart down the road?” If that happens then you have to very clear what you’re going to be doing with the home.
If you haven’t made plans on how you intend to transfer ownership or sell the house, you could end up using it as a battleground where only the lawyers win and you both end up losing money.
Here are some things to keep in mind.
Who Owns the House?
Whosever name is on the deed of sale is the owner has all the financial responsibilities and obligations toward the home.
So, if both your names are on the deed then you are both financially responsible for paying the mortgage and taxes. If one person moves out they both still have to assume that responsibility. Similarly, they also are legally obligated to receive their respective share of any profit from the home when it is sold.
Just remember that if one person bought the house and a partner moved in later and pays rent such as splitting the mortgage, then the person paying the rent is not legally entitled to receive any profit when the home is sold unless they have entered in a separate contract which stipulates otherwise.
But common law relationships are being treated more similarly to married couples these days. However, how a common law relationship is viewed legally by the courts can be tricky and how you are defined as a common law relationship can be influenced by how long you live together and how you share or not share assets and income.
And remember, how the law views your relationship and standing now can be a totally different thing several years down the road.
It’s a good idea to seek legal advice before you take the plunge into a real estate investment as an unmarried couple so you can consider your options. It’s vital you do this before you enter into such an important investment with your eyes open and the legal pitfalls covered beforehand.
What Happens If Someone Should Die?
If an unmarried couple buys a home with both their names on the property deed, will the partner automatically inherit their partner’s half of the home? Not necessarily. Unlike a married couple where a spouse will normally inherit the deceased spouse’s portion of the home, it can be quite different for an unmarried couple.
If one of the unmarried partner’s dies and both their names are on the property deed, then the portion of the home owned by the person who dies will go to their estate, and not necessarily to the survivor. Again, the legal ramifications of a common law relationship may come to bear and pose a potential legal challenge.
The simplest way to approach this scenario and you want to ensure that your partner receives your portion of the home; you will need to draw up a will and to specify your partner inherits their half of the home as one of the terms in the will.