Buying a home together can be exciting, but when you are not married, the purchase raises important questions about ownership rights, financial obligations and long-term planning. In New Jersey, cohabitation does not create the same property rights as marriage, so establishing clear legal terms before closing is essential.
When you buy together, the deed, mortgage and any written agreement can affect what happens if one person dies, moves out or wants to sell.
Choose how you will hold title
Because the deed controls legal ownership, unmarried partners often choose between two common ownership structures.
A joint tenancy with right of survivorship generally allows the survivor to receive the other owner’s share after death. However, survivorship rights do not remove every concern. An unmarried partner may still need to consider New Jersey inheritance tax because a nonspouse beneficiary can fall under a less favorable tax class than a surviving spouse.
A tenancy in common allows each partner to hold a separate ownership interest in the property, and those interests do not have to be equal. For example, one partner may hold a 60% interest while the other holds 40%. Each owner may also leave their share to a chosen beneficiary through a will.
Put payment terms in writing
Unlike spouses going through divorce, unmarried partners do not rely on the same equitable distribution rules if the relationship ends. A written cohabitation agreement can explain how you will handle the home during the relationship. If you cannot agree on a sale or buyout later, one co-owner may need to file a partition action and ask the court to divide the property or order a sale. This agreement may address:
- Mortgage, tax and insurance payments
- Repairs, utilities and major home expenses
- Buyout terms if one partner wants to keep the property
- How sale proceeds will be divided
- What happens if contributions stop
Putting these terms in writing can make each person’s expectations clearer before problems arise.
Understand the mortgage risk
The deed controls ownership, but the mortgage controls who owes the lender. If both names are on the loan, the lender may hold either party liable for the entire debt. If the other borrower stops paying their share, you may still be responsible for the full amount.
Reviewing how title, loans and written agreements work together before closing can help protect your investment and prevent future legal confusion.