House Rules: Buying home with someone you're not married to

by Jim Buchta of Star Tribune
Published 5/2002

Whether they're domestic partners, altar-shy couples or just friends, unmarried people who buy a home together face a unique set of emotional and financial considerations.

"It's definitely a huge issue," said Edina Realty agent Sheri Fine. She said anyone considering buying a house with someone other than a spouse should see an attorney first.

If either party objects to bringing in an attorney, "that tells you something about the relationship, and maybe it's not something you should do," Fine said. With joint ownership, there are too many potential pitfalls and financial considerations to leave things to chance.

Unmarried couples aren't covered by the same laws that govern married couples, so a written agreement is crucial. It should spell out the rights and responsibilities of each buyer, whether they have a financial obligation or not, experts say.

Jordan Sramek bought this house in St. Paul with a friend. Trouble arose when she wanted to sell and he wanted to stay.

Kris Wilson, a loan officer with Summit Mortgage in Bloomington, said that resistance to setting up a formal agreement isn't uncommon. About 25 percentage of her customers are domestic partners, and few have signed
such an agreement.

"They're in love, and they can't see that this person who they're in love with could ever be adversarial towards them," Wilson said.

Minneapolis attorney Susan Born said there are
several issues to consider:

Who's responsible for paying the bills?
What's going to happen if one person can
longer can pay his or her share?
What happens if one person should die?
What happens if the couple split up - who gets to stay, or how will the equity in the house be divided if they decide to sell?

The same issues apply to cobuyers who are not romantically involved, of course.

Jordan Sramek and a longtime friend bought a house together n 1994. Everything was fine until his housemate decided to take a job in Antarctica that kept her out of the country for months at a time, leaving Sramek with more responsibility that he felt was fair.

Both contributed to the down payment, both names were on the mortgage and both names were on the deed, but they couldn't agree on how to resolve the stalemate between them.

She wanted to sell; he wanted to stay. "I'd planted a huge garden and there was no way I was going to leave," Sramek said.

They each hired lawyers, and after years of negotiating and thousands of dollars of legal fees, Sramek got to keep the house, which he refinanced to buy out his former friend's share.

He now regrets that they didn't have a partnership agreement.

When they were buying the house, "There were so many details to consider, and unfortunately the most important one was overlooked," Sramek said. "And I definitely paid for it."

Born said partnership agreements run the gamete from just the basics to highly detailed. One couple used theirs to specify who would shovel the sidewalks and who would mop the floors, but most focus on financial rights and responsibility.

Harrision Grodnick said that when he and his high-school sweetheart, Marissa Kudak-Sucik, decided to buy a house together, they chose not to create a partnership agreement because he's confident they'll never need one.

Buying a home doesn't put a stamp on any feelings we have," said Harrision, who said he and Kudak-Sucik have no plans to marry. "But if we didn't feel this way, we wouldn't do it."

Born said that although it's not easy, couples need to talk about the consequences of the possible demise of their relationship, just as they would prepare for a fire by guying homeowner's insurance.

"It's easier to reach those agreements when you still have those starts in your eyes then when you don't," she said.

"The changes of a house burning down in infinitesimal compared with the chances of the relationship failing."

House Rules:

If you buy a house with someone you're not married to, experts advise weighing the emotional considerations along with the financial.