If you are cohabiting but are not married then you may be financially vulnerable if it all falls apart. 

There is no such thing as a “common law spouse” and you have none of the protection afforded to married couples under matrimonial law.  This may come as a surprise (and a worry) especially if you have children.

If there is a property owned by one or both of you then you should seriously consider safeguarding your interest in it.  This can be done so by being registered as “Tenants in Common” with either equal or unequal shares and entering into a Declaration of Trust.

There are three different ways to own a property.  The most common is as “Joint Tenants” which means that the house is jointly owned and should you separate then you would each receive 50% of the equity and if one of you were to die the other would receive their interest in the property.  This is usually how married couples own a property but cohabiting couples may well do so as well.

The second way is as “Tenants in Common in Equal Shares”.  This means that you both own 50% of the property but the difference between this and “Joint Tenants” is that you can will your share to someone else – it would not necessarily pass to your partner if you died (unless they specifically benefited under your Will).

The third way is as “Tenants in Common in Unequal Shares”.  This means that you each own a specific share of the property and these shares and other matters are set out in a Declaration (or Deed) of Trust which you would both sign.

If you paid money towards the deposit on a property, or are paying towards the mortgage or have paid towards home improvements then you need to consider protecting your interest.  If options 1 or 2 already apply then you have the certainty of 50% of the equity.

However, if the property is in your partner's sole name, or if it is in joint names and you wish to receive more than 50% of the equity should you separate then you should consider a Declaration of Trust and changing the ownership to “Tenants in Common in unequal shares”.

So how do you go about this?

Often this decision is made when a property is purchased as the Conveyancing Solicitor should ask you how you wish to hold the property and they can arrange for a Declaration of Trust to be drawn up.  You should both obtain separate legal advice in this respect.

If you wish to consider this after purchase this is still possible. If you own the property as joint tenants then you can apply to the Land Registry to sever the joint tenancy and you can enter into a Declaration of Trust.

A Solicitor will be able to deal with both of these steps for you and this is likely to cost approximately £250 - £500 + VAT depending on your Solicitors' charging rate.

However, if this means your interest is protected then it is money worth spending.

When entering into a Declaration of Trust you should consider what needs to be covered.  These are just a few of the things you need to think about:-

• Protecting the deposit money you put into the property.  If that money came from a previously jointly owned property do you want to consider the different contributions you made to that property?
• Protecting costs of purchase which you may have solely paid such as the conveyancing costs, stamp duty and removals etc.
• Protecting your contributions to the mortgage.
• Protecting money you paid for home improvements.
• Protecting any other outgoings you may pay for such as insurances, utility bills etc.
• Have you loaned your partner any money and do you want this repaid on separation?
• Also consider any mechanism for buying out your partner's share.
• Finally if you have children do you want some kind of agreement which allows you to stay in the property until they reach 18 years?

If your interest is not protected then your only option may be to go to Court to deal with this.  Court proceedings can be expensive and if you can avoid this by some forward planning then this must be the best way to proceed.  If may not be romantic but you can both then be protected in case something does go wrong!