If you are buying a house on your own, one question you might have is: when one partner owns the house, what are the rights and risks for the other partner?
In a marriage or civil partnership, the law is very clear on living together. Usually, both parties own a share of the equity in the property, even if the house deposit, mortgage, and repayments are all under one person’s name. The law assumes some degree of shared assets in a marriage or civil partnership (note, that it might not be 50/50 as commonly assumed).
However, what if one partner owns the house, but their boyfriend, girlfriend, or partner stays there permanent too? What rights does a partner have to your house if they are permanently living there, helping to pay the bills, and doing property maintenance? What if they pay rent, or a share of the monthly mortgage payments?
Cohabitation rights is a very tricky area because it is so murky. If you own your house and are thinking of allowing your partner to move in, there are a few things you should consider.
We have broken down our article into four sections:
- Legal rights of a cohabiting partner
- Cohabitation Agreement
- Unmarried couples property rights
- Property rights during a relationship breakup
Legal rights of a cohabiting partner
When one partner owns the house, and the non-owning partner moves in, their rights are murky as they are neither a homeowner, nor a tenant, nor even a lodger at this point. What rights they have depends on three things:
- Does the non-owning partner have a beneficial interest in your property
- Family Law
- Is there some sort of contract or agreement in place
Without either of the above, the non-owning partner will have little or almost no rights in the eyes of the law, to remain in the property or even a share of the property value.
We will not go into the ins and outs of Beneficial Interest in this article as we could write whole books about it! But the basic argument here is – if your partner, girlfriend, or boyfriend has contributed financially to the property or added substantial value to the property, they could be entitled to a share of the property proceeds, and even the right to continue inhabiting the property even if you want them to move out. For example, one way to establish Beneficial Interest if they contributed to the house deposit. However, even examples where they built a loft conversion or did a major renovation work on the property, could count as Beneficial Interest. Even one when partner owns the house, and only their name is on the title deed, a partner or indeed anyone else who can show a contribution to the property could claim Beneficial Interest.
The second way a non-owning partner, boyfriend, or girlfriend could have rights is by Family Law – if they are a parent or legal guardian to one of the children staying at the property. Family courts might view it as necessary for the partner to be allowed to stay at the property, for the interest of the children, even when only one partner owns the house.
The third way is if through a documented agreement, called a Cohabitation Agreement (see next section) or a Living Together Agreement. This is the best way to ensure both parties are clear on not just property matters, but also other financial matters and children, for unmarried couples or partners who live together.
Sometimes also called a Living Together Agreement, this is a legal document that outlines what happens in matters where there could be disagreements in the future. For the purposes of your home ownership, you can draft up a Cohabitation Agreement that outlines whether your partner, girlfriend, or boyfriend is entitled to any share of your property if your relationship breaks down. You can also specify expectations of financial contribution – for mortgage payments, for maintenance works, utility bills, insurance, damage, etc. Finally, you can also specify what happens in the event of a break up – how much notice is required for the non-owning partner to move out, and how to divide up any items in the property.
Of course, over-arching Property Law and Family Law can over-rule anything you agree to in a Cohabitation Agreement. But if you have a written Cohabitation Agreement in place, it makes it very clear to the courts what the intentions are of both parties when one partner owns the house, and the courts can take this into consideration if there is a dispute.
Creating a Cohabitation Agreement when one partner owns the house might be an awkward conversation to have. It is similar to a pre-nuptial agreement, and can cause questions of trust between partners, boyfriends, and girlfriends. However, the key thing to bear in mind is that it can protect both the homeowning partner as well as the home occupying partner, not just the former.
When is a good time to bring up the subject of a Cohabitation Agreement? Probably after you have completed the Road to Exchanging Contracts, and before you Complete on the property and move in to your new home together.
Unmarried couples property rights
At the moment there is no explicit legal protection when unmarried couples live together in a property where one partner owns the house. This sometimes leads to serious issues, especially if there is an unexpected death of one partner.
However, there is a new Cohabitation Rights Bill (2019-2021) winding its way through parliament that aims to make it clear the property rights of unmarried couples, where one person owns the house and their partner moves in, especially in the event of the death of one partner, and where there are children involved.
The bill is still in the early stages of being debated, and it is unknown when it will pass and what the final form will be.
Property Rights During a Relationship Break-Up
Note that if you are currently cohabiting already, but there is a breakdown in the relationship, this article does not cover that situation. There is a good section on Shelter on the rights of cohabiting couples after a relationship breakdown.
Frequently Asked Questions (FAQs) on Cohabitation Rights
Hopefully, the sections above makes it clear what are the rights and risks for unmarried partners, girlfriends, and boyfriends when living together when one partner owns the house.
But we have also compiled a list of frequently asked questions that we get asked at First Time Buyer Help, to answer some of the key questions that FTBs have when one partner owns the house:
Would a live in partner have rights to my property?
The rights that a live-in partner will have depends on four things:
– Beneficial Interest
– Family Law
– Contractual Agreements (e.g. Cohabitation Agreement)
– Property Law
Beneficial interest is when a partner has contributed financially, or in a value-added way, to the property value. This includes contributing to the house equity, for example through the deposit or mortgage payments.
Family Law is also considered, if the unmarried couple are parents to children, or if the live-in partner is a legal guardian to the homeowner’s child. The courts might find that the live-in partner has rights to continue staying at the property, or a financial claim to the property.
A contractual agreement, like a Cohabitation Agreement, will also dictate the cohabitation rights that both parties agreed to abide by, in the event of a relationship breakdown or the death of a partner where one partner owns the house.
Finally, as this matter is relating to property, Property Law applies. We won’t go cover it here as it is a very detailed subject, but be aware normal housing and property law applies to cohabiting couples too even when one partner owns the house.
Can my girlfriend/boyfriend take half my house?
In the vast majority of cases, the answer is no – your girlfriend, boyfriend, or partner cannot take half your house.
There are scenarios where it is possible – and the two major ones are if they have a Beneficial Interest in the property, or if there is a Cohabitation Agreement in place.
The first, Beneficial Interest, relates to the amount of money and value-add done by the non-owning girlfriend, boyfriend, or partner does. While on paper it looks like one partner owns the house from the property deed, the courts will take into account whether the other partner contributed a share of the house deposit, mortgage payments, or maintenance of the house.
In addition, if the non-owning partner has added value to the property, say building an extension or loft conversion or improving the state of the property such that the property value has increased, the courts could view that as having a Beneficial Interest.
Beneficial Interest is a murky area, subject to interpretation, and therefore it is better to have a Cohabitation Agreement in place. This sets out, on paper, the understanding between the one partner that owns the house and the other home occupying partner, in terms of rights to stay in the property, rights to a share of the equity in the property, and what happens during a relationship breakdown or death of a homeowning partner.
What rights does a partner have to my house?
Where one partner owns the house, the other partner generally has very little rights to the house. Either in terms of rights to stay, or financial rights when the property is sold.
The law is not entirely clear on the process regarding notice periods or rights to stay in the property, unlike a Lodger Agreement or an Assured Shorthold Tenancy Agreement.
Generally, you are expected to give “reasonable notice” to your partner, girlfriend, or boyfriend if your relationship breaks down and you wish for them to leave the property. However, there are considerations around Family Law, if they care for children who live in the property. In addition, they could have some rights as a squatter if they refuse to move out.
When it comes to property rights of unmarried couples and partners, in terms of property equity, generally unless they have a Beneficial Interest or there was a Cohabitation Agreement in place, all the home equity still belongs to the sole homeowner on the Title Deed.
Beneficial Interest is when a partner has contributed financially or contributed added value to the property. This includes contributing to the equity in the property, for example through the deposit or mortgage payments.
Is rent from partner taxable?
If one partner owns the house, often the other partner will contribute to some of the financial obligations of running a household. Such as utility bills, maintenance, food, insurance, council tax, etc. If you and your partner also decide to split out the cost of the property, eg the mortgage costs, there are several ways to do it. But charging “rent” is not the best way, as rent will be taxable at income tax rates.
Do not create a Lodger Agreement or Assured Shorthold Tenancy Agreement, as neither applies in the situation of a cohabiting couple when one partner owns the house. The law treats you as a single household, so monies paid by the home occupying partner to the homeowning partner should not be taxable.
However, be aware that if a girlfriend, boyfriend, or partner contributes directly to the mortgage costs, for example via a Direct Debit to the mortgage provider, it could be considered as building up a Beneficial Interest in the property.
Hence the best way is to create a Cohabitation Agreement where it is clear what the monthly financial obligation from one partner to other is, but the rights to the property equity is set in stone and understood by both partners from the beginning.
To show that you are a cohabiting couple in the same house, do make sure both of you are both registered to the property – in terms of electoral roll, council tax, and other bills.
Do seek legal advice if you do plan to get your partner to contribute more than just bills and their share of the running costs, especially if it is a large amount in the thousands of pounds or more, as you want to make sure it does not count as rent and therefore attract income tax!
Is my partner entitled to half my house?
It depends on the situation, but in most of the standard cases, the answer is no. Cohabiting partners, unmarried couples, boyfriends, girlfriends do not have the same rights to property as married couples or civil partnership couples do.
When one partner owns the house, and their name is the sole name on the title deed, then the starting point is that the property still belongs 100% to that homeowning partner. Even if they have a cohabiting partner for many, many years.
However, under the law, there are several situations where a cohabiting partner is entitled to part, or even half your house. We explore this in the section above – legal rights of a cohabiting partner.
Do I need to tell my mortgage company if my partner moves in?
No, you do not need to tell your mortgage company, as the mortgage is in your sole name, and you are not renting out the property to your partner.
When one partner owns the house, the other partner has no legal obligation towards the mortgage, nor inherits any of the mortgage liability.
There are two scenarios where you should tell your mortgage company though. The first is if you are getting married, and therefore you would like your mortgage to be changed to a joint mortgage, so you are both joint owners and jointly liable for the mortgage. The second scenario is if you are not going to be living in the property as your primary address. You will need to tell your mortgage company that you will not be living in the property the majority of the time, and that someone else, your partner, will be.
Does my boyfriend/girlfriend have rights to my house?
There are two types of rights to consider – the right to stay in the property, and the right to financial interest in the property – when your boyfriend, girlfriend, or partner is moving in with you and you own the house.
Your boyfriend or girlfriend has very little right to stay in the property, as the rights of a cohabiting partner is less than that of a lodger or a tenant. However, the law is very clear that if you do break up, your partner has the right to “reasonable notice” to find a new place to move to.
When one partner owns the house, the other partner has little rights to the financial interest of the property – eg the equity in the house when it is sold. Unmarried couples, boyfriends, girlfriends, and partners do not enjoy the same strong property rights as married couples or civil partnerships. However, be aware that there are some situations where partners are entitled to a financial interest in the property – we cover that in the section above, legal rights of a cohabiting partner.