Marriage may not be right for you, but legal protection sure is! If you should separate from your common-law spouse, do you know what you are legally entitled to? In addition to the emotional impact of a break-up, such an event often raises issues about how to deal with common property. Married couples benefit from legal protection in the event of a divorce (or death), but it is an entirely different story for common-law relationships (defined as a couple living together for at least 12 months), according to the Civil Code.
Forever After or Horror Story?
You are moving in with your boyfriend into the condo he purchased before meeting you. You verbally agree that he will pay the mortgage and that you will take care of the other expenses. No need for an official contract. However, ten years later things fall apart. Your now ex wants you out of home immediately without even offering monetary compensation. Is this legal? Absolutely, since your name does not appear on the condo’s act of acquisition!
Another scenario? Your life partner has passed away and there is no official paper designating you as the beneficiary of the property you have been living in and paying for with her during the past five years. The new owner is your mother-in-law! Or, as another example, you contributed $100,000 to the down payment at a time when your spouse had no money. Ten years later, when separating, he refuses to pay what is owed to you. What can you do to avoid such a nightmare becoming reality? Follow our advice:
1. Both Names of the Act of Acquisition
Legally, the only way to be considered a co-owner is for your name to be included on the act of acquisition. In this way, you will both be responsible for the property’s maintenance and mortgage. Furthermore, neither party will be able to sell or rent out the house without the other’s consent. Be equally aware that you can have your name added to the act of acquisition even after living together for several years. Just go to the notary! Why take the risk of ending up high and dry when such a simple solution is available?
2. Protect Your Down Payment
It regularly happens that two spouses can’t equally contribute to an initial down payment. It is therefore advised to have this clearly indicated in a notarized contract or an acknowledgement of debt (that can be notarized or simply signed before witnesses). These documents must contain detailed information about what both partners have agreed upon. For example, if one party covered the entire down payment, say $80,000, the other could recognize that they owe them $40,000 (with or without interest!). There are as many situations as there are couples. The important thing is that everyone is satisfied.
3. A Cohabitation Agreement
Another form of protection? A contract between common-law partners, also called a cohabitation agreement. Even though it is always preferable to have it prepared by a notary, it is possible to write it yourself (and sign it before witnesses). It should include the details of what has been agreed regarding the payment of household expenses. Very useful to avoid disagreements during a separation! Especially in cases where a mother has put her career on hold for a few years to raise her children.
4. Make You Will
We hate thinking about death; however, to protect the people we love, it is important to have an up-to-date will. Because the common-law spouse is not the de facto heir to your house, this document will make them so. In fact, legally, if you should pass away, you closest relatives will inherit your property. Imagine living in a home you have in part paid for during 20 years only to not become full owner when your partner passes away, or worst, for the house to pass to his ex-wife because the will is 20 years old. What hell!
5. Be Insured
It is also possible to purchase life insurance or mortgage insurance designating a beneficiary of your choice. Even if your life partner’s name is not on the act of acquisition, they will become the only owner when you are gone.
Psst! Don’t forget, better late than never! Even if the property was purchased years ago, it is still possible to produce legal documents that will guarantee you financial protection.