If you’re a woman between the ages of 21 and 35, chances are you remember this heart-wrenching episode from HBO’s Sex and the City:Carrie, the quirky newspaper columnist and the show’s heroine, gets dumped by her fiance, Aidan.
As if relinquishing her diamond weren’t bad enough, he also gave her an ultimatum: Either come up with $45K to buy their apartment from him in 30 days or she’d be out on the street.
Unfortunately for many co-habitating couples, that’s exactly what happens when they decide to call it quits.
“Even one if one is paying the rent and the other is doing the laundry, the cooking, grocery shopping and takes care of the cat, there’s no legal obligation between (couples) to continue on any of those expectations,” says Lois Liberman, a partner in matrimonial law at Blank Rome LLP.
There’s a simple way Carrie could have protected herself – or at least had more time to prepare: a co-habitation agreement.
Much like a prenup, a co-habitation agreement is something partners can use to protect themselves in the event that they either split or one of them suddenly passes away. And unlike a will or estate plan, which can be changed any old time, you wouldn’t run the risk of having your ex write you off if things turned sour.
Why you want one
In today’s housing market, “getting to keep the apartment” probably feels less like a victor’s lap and more like a coup de grace.
“It’s very difficult now to take people off mortgages,” Liberman says. “You’d have to refinance, but now you’ve got to qualify (for a loan) by yourself.” That’s no easy task to bear, especially with so many consumers crushed by debt and banks unwilling to dole out risky loans like they used to.
How to do it
There are simple ways to go about pulling together a co-habitation agreement. Either hire an attorney – fees vary widely – or prowl the Web for a free copy you can fill out and notarize yourself (try Rocketlawyer or Legalzoom).
Starting the conversation may be awkward, but unless you want to wind up like Carrie – a closetful of $400 shoes and no where to stash them – then you probably need to find a way.