Sample Property Co-Ownership Agreement For Two Parties Who Will Live Together
This agreement template is designed for situations where two parties will co-own a home and live in it together.
This form agreement can be used for property in any U.S. state. It will work when the property is owned in equal shares or unequal shares. Additional language can be added where the percentage of ownership will change over time, or where one party will lend the other money.
This sample agreement is comprehensive and complete, and is designed to protect the parties in case of unforeseen events or disagreements, as well as following death or separation. But the agreement is not written in “legalese”. It is plain English designed to be easy to understand and customize. The agreement is seven pages in length and includes a detailed table of contents for easy reference.
This sample agreement includes the following sections:
LOANS AND ENCUMBRANCES
GENERAL TRANSFER RESTRICTIONS
MANDATORY SALE OR BUYOUT
DISTRIBUTION OF PROCEEDS
DEATH OF AN ORIGINAL OCCUPANT
TITLE AND ALLOCATIONS
PARTNERSHIP NOT INTENDED
CO-OWNERSHIP SHARES AND CO-OWNERS
OTHER GENERAL PROVISIONS
Important issues covered by this agreement template include:
- Possessory Rights:While the parties are living together, are there limits on the ability of one party to offer housing to a relative or friend? What happens if the parties no longer wish to live together?
- Allocations:How will ownership expenses be shared? How will expense allocations change if one party dies, or if the parties no longer live together? How will proceeds from the sale of the property be split? This form agreement is structured so that all expenses can be shared according to the same percentages, or so that different expenses can be shared according to different percentages.
- Exit Strategy:When and how will the property be sold? Can one owner force the other to co-own the property forever? Under what circumstances can one owner force a sale? How will the pricing and sale process work if one owner is more anxious to sell?
- Death:What happens if an owner dies? Can the deceased owner’s heirs force the surviving owner out?
- Holding Title:How will title to the property be held? Will the rights and duties of ownership be allocated according to how title is held?
- Disputes:What happens when the co-owners disagree? What happens when one co-owner is not paying or doing his/her share?
This form agreement is intended for partners who are neither married nor registered domestic partners, but it can also be used by married or registered couples if an additional paragraph is added. The necessary content of that additional paragraph depends on two factors: (i) the law of the state where the parties reside; and (ii) whether the parties enter into the agreement before or after their marriage/registration.
This agreement template will require only fill-in-the-blank modifications for the vast majority of couples. It can be used as a stand-alone document, or together with our Memorandum of Agreement [link here] for even greater protection. For those co-owners with more complicated arrangements, our attorneys can assist with suggestions and modifications for a modest additional fee.