Legal Definitions - living-together agreement

A living-together agreement, also known as a cohabitation agreement, is a legally binding contract entered into by two individuals who live together but are not married or in a registered domestic partnership. This agreement outlines their respective rights and responsibilities regarding financial matters, property, and support during their relationship and specifies how assets and debts will be divided if the relationship ends or if one partner passes away. It allows partners to proactively define their arrangements, providing clarity and potentially avoiding disputes in the future.

• Example 1: Joint Property Purchase

  Liam and Chloe decide to buy a house together. Liam contributes 70% of the down payment, while Chloe contributes 30%. They plan to split the mortgage payments equally. To protect their individual investments and clarify how the equity would be divided if they were to separate, they draft a living-together agreement. This agreement specifies that upon sale of the house, after repaying the mortgage, Liam would receive a larger percentage of the initial down payment back before the remaining profits are split, reflecting his greater initial contribution. This illustrates how the agreement defines financial rights and property division for unmarried partners.

• Example 2: Financial Support and Career Development

  Sarah, a successful software engineer, decides to move in with Mark, who is pursuing a master's degree and has limited income. Sarah agrees to cover the majority of their shared living expenses, including rent and utilities, while Mark focuses on his studies. They enter into a living-together agreement that details Sarah's financial contributions and clarifies that these contributions are not considered a loan. It also outlines what would happen if their relationship ended before Mark completed his degree, ensuring both parties understand their financial obligations and expectations, thereby preventing future misunderstandings about support.

• Example 3: Blended Families and Separate Assets

  David, a widower with two adult children and significant inherited assets, decides to move in with Emily, who has her own separate savings and a small business. Both wish to keep their finances and assets entirely separate, ensuring that their individual estates pass to their respective children without complication should one of them die. They create a living-together agreement that explicitly states all assets brought into the relationship remain separate property, outlines how shared expenses will be divided, and confirms that neither will have a claim on the other's pre-existing assets or future inheritances. This demonstrates how the agreement can protect individual estates and clarify financial independence within a cohabiting relationship.