Property Rights of Unmarried Couples in North Carolina
Frequently asked questions to help unmarried couples determine who owns what
If you haven't been together long and don't own much, it's really not necessary. But the longer you live together, the more important it is to prepare a written contract making it clear who owns what -- especially if you begin to accumulate a lot of property. Otherwise, you might face a serious (and potentially expensive) battle if you split up and can't agree on how to divide what you've acquired. And when things are good, taking the time to draft a well-thought-out contract helps you clarify your intentions.
Another way to deal with owning property together is to use a joint purchase agreement for individual items as you buy them.(back to top)
It's particularly important to make a written property agreement if you buy a house together; the large financial and emotional commitments involved are good reasons to take extra care with your plans. Your contract should cover at least four major areas:
My partner makes a lot more money than I do. Should our property agreements cover who is entitled to her income and the items we purchase with it?
Absolutely. Although each person starts out owning all of his or her job-related income, many states allow this to be changed by an oral contract or even by a contract implied from the circumstances of how you live. These types of contracts are ripe for misunderstanding. For example, absent a written agreement stating whether income will be shared or kept separate, one partner might falsely claim the other promised to split his income 50-50. Although this can be tough to prove in court, the very fact that a lawsuit can be brought creates a huge problem. For obvious reasons, it's an especially a good idea to make a written agreement if a person with a big income is living with and supporting someone with little or no income.
Example 1: Rose and Ted have lived together for four years. They've never had any written agreement, but their behavior has been consistent: they've purchased a car, an oak table and a china set, with each one paying half. If they split up, a court is likely to imply an agreement and equally divide the items purchased together.
Example 2: Jon and Steve plan to buy a fixer-upper house and move in together. Jon is a carpenter; Steve is a university professor who makes nearly twice as much as Jon. Jon and Steve plan to own their home equally, so they agree in writing as follows: Steve will pay two-thirds of the mortgage, and Jon will pay one-third. Steve and Jon will equally pay for the materials to fix up the house, and Jon will contribute all the labor. Steve and Jon also agree to equally own all the property, furniture and fixtures they buy once they move in together.(back to top)
Palimony is a phrase coined by journalists -- not a legal concept -- to describe the division of property or alimony-like support paid to one partner in an unmarried couple by the other after a break-up. Members of unmarried couples are not legally entitled to such payments unless they have a written agreement (or a court finds there was an oral or implied agreement). A written agreement stating that you both will remain financially independent is the best defense against a cry for palimony.(back to top)
Not unless you have specifically undertaken responsibility to pay a particular debt -- for example, as a cosigner or if the debt is charged to a joint account. By contrast, husbands and wives are generally liable for all debts incurred during marriage, even those incurred by the other person. The one exception for unmarried couples applies if you have registered as domestic partners in a city where the domestic partner ordinance states that you agree to pay for each other's "basic living expenses" (food, shelter and clothing).(back to top)
Nothing, unless the deceased partner made a will or used another estate planning device such as a living trust or joint tenancy agreement, or, if under the terms of a contract (such as a contract to purchase household furnishings together), the survivor already owns part of the property. This is unlike the legal situation married couples enjoy, where a surviving spouse automatically inherits a major portion of a deceased spouse's property. The bottom line is simple: to protect the person you live with, you must specifically leave her property using a will, living trust or other legal document.(back to top)