How to Draft a Cohabitation Contract
Add a title., Identify the people living together., State the purpose of the contract., Insert a provision about disclosures., Describe the consideration., Divide the rent., Allocate utilities., Divide debts., Allocate household expenses., Allocate...
Step-by-Step Guide
-
Step 1: Add a title.
At the top of the page, insert the title: “Nonmarital Cohabitation Agreement.” Make the words bold or underline them. -
Step 2: Identify the people living together.
In the first paragraph, you need to lay out the facts about the parties: name, address, as well as the date the agreement is entered into.
For example, you could type, “Agreement made this 12th day of June, 2016, by and between Ashley Smith (“First Party”) and Ben Jones (“Second Party”), who reside at 1234 Alphabet Drive, Chicago, Illinois.”, In the second paragraph, you explain why this contract is being created.
For example: “The Parties desire to establish their rights and responsibilities with respect to each other’s property and income, as well as any property and income they may acquire, either separately or jointly, during the cohabitation.”, You need to state that each person has made complete disclosures about finances and debts to the other person: “Each Party has made a full disclosure to the other Party concerning their debts and assets.”For this reason, it is a good idea to sit down before drafting the contract.
You should gather all of your financial information and meet with the other person. , A valid contract requires “consideration.” This is what you give up in order to make the contract.
You should explain the consideration in a separate paragraph.
Typically, in a cohabitation contract, the consideration is your promise to abide by the contract.
You could write something like this: “Consideration consists of the mutual promises contained in this agreement and of the promises of each Party to act as the living companion to the other.” , You need to explain how rent (or a mortgage) will be divided between the two of you.
There are two ways to divide the rent: assign a dollar amount to each person or assign a percentage.
You should probably assign rent (and any other expense) as a percentage.
Your rent and other expense can increase each year, and you don’t want to redraft the contract each year.
As you divide up expenses, you should create three columns.
Label the first column “Monthly Expenses,” and underneath put “rent” or “mortgage.” Label the second column “First Party” and the third column “Second Party.” Underneath, write the percentage each person will pay for each expense.If you decide to divide expenses in half, then each person will pay 50%. , After rent, you need to divide up your utilities.
Common utilities will include:telephone gas electricity water and sewer garbage collection cable television internet service property taxes , If you took out debts with the person you are living with, then you will need to divide the debts.
Assign a percentage, just as you did to utilities:car or truck payments home equity loans other loans credit cards day care , You should decide how you will divide household expenses such as food and home improvements.
Go through and assign a percentage to the following:groceries school lunches (if you have children) cleaning supplies or services yard maintenance home maintenance and improvements home security appliances home furnishings , You can also decide ahead of time how you want to divide personal expenses like entertainment, travel, eating out, or pet-care costs.
Some people might not want to get into this level of detail; instead they might only want to divide the big costs.
However, if you want to allocate personal expenses, then do so for the following:take-out meals entertainment gifts travel any hobbies pet care babysitting , Although you will be living together and sharing common expenses, you probably want to maintain ownership of your individual property.
This is property you bring into the house for your own benefit.
It also includes anything you bought for yourself without an intent to share.
You might want to include a few provisions regarding the following:
Individual income: “The parties shall keep the following property as separate property:
Individual earnings, salary, or wages acquired both before and after the execution of the Agreement.” Gifts: “Individual gifts, devises, inheritances, or bequests acquired both before and after the execution of this Agreement.” Property: “All real or personal property, owned by a Party at the date this Agreement is executed, to include all proceeds or income derived from these properties.” , You might be worried that by living together you are creating a common law marriage.
If you did, then either of you might be entitled to support and maintenance after you separate.
You can waive any support or maintenance in the contract: “The Parties waive the right to ‘palimony’ or any other form of maintenance or support, both permanent and temporary.”, Likewise, you should expressly waive the right to share in each other’s estates at death: “The Parties waive the right to share in each other’s estates on death.”, Sometimes cohabitants will disagree on something.
For example, you might disagree about whether to install a landline phone.
Or you might disagree about who gets joint property if you separate.
You should include a provision stating that you will try to resolve disputes in mediation.
For example, you could write, “In the event a dispute arises between the Parties, the Parties agree to participate in mediation.
They will participate in at least four hours of mediation in accordance with the United States Arbitration & Mediation procedures.
The parties agree to share equally in the costs of mediation.”, If you go to court, then a judge will need to interpret the contract.
You can decide which state’s law to use.
Generally, you will use the law of the state you live in.
A sample provision might read: “This Agreement shall be governed by the laws of the State of Illinois.”, This clause states that the written contract contains the entire agreement between the parties.
It is important to have because you don’t want the other person claiming that you had an oral side agreement.
Here is a sample merger clause: “The Parties intend that this Agreement is the full and complete agreement between the parties regarding their cohabitation.
There are no other agreements, oral or written, between the Parties regarding the cohabitation.
The Parties can modify this Agreement only by a writing executed by both Parties.”, If you end up in court, then the judge might find that one provision in your cohabitation contract is illegal.
When that happens, the judge has to decide whether to sever that provision and keep the rest of the contract or void the whole contract.
A severability clause tells the judge to sever any illegal part of the contract but enforce the remainder.
You could write, “If any paragraph or provision of this Agreement is found invalid, void, or unenforceable, then it is the intent of the Parties that the remaining parts should continue in force and effect.”, After you have typed up the contract, you should have an attorney go over it with you.
A cohabitation contract is a valid contract.
You should fully understand your rights and responsibilities.
To find an attorney, you can contact your local or state bar association and ask for a referral.
If you don’t have much money, you should read Hire a Lawyer When You Have Low Income for tips on getting low-cost legal help. , Include a line for both people to sign individually.
Above the signature line, include the following:“I have read the Agreement and have spent time considering its implications.
I fully understand the contents and I agree to its terms.
I voluntarily submit to the execution of this Agreement.”Add lines for witnesses.
You should probably have two witnesses observe the signing.
Include a signature line for them as well. , You should sign the contract in front of a notary.
Although not required in every state, having the contract notarized can help resolve disputes later on about whether the contract is valid.
You can find a notary in most courthouses or large banks.
You can also use the locator feature at the website for the American Society of Notaries.Make sure that you take personal identification to the notary.
A valid passport or driver’s license should be acceptable. , Store your copy of the cohabitation agreement in a safe place.
You will want to refer to it later should a dispute arise. -
Step 3: State the purpose of the contract.
-
Step 4: Insert a provision about disclosures.
-
Step 5: Describe the consideration.
-
Step 6: Divide the rent.
-
Step 7: Allocate utilities.
-
Step 8: Divide debts.
-
Step 9: Allocate household expenses.
-
Step 10: Allocate personal expenses
-
Step 11: if you want.
-
Step 12: Clarify who owns individual property.
-
Step 13: Waive rights to support or maintenance.
-
Step 14: Waive any right to inherit.
-
Step 15: Include a mediation provision.
-
Step 16: Insert a choice of law provision.
-
Step 17: Add a merger clause.
-
Step 18: Add a severability clause.
-
Step 19: Review the contract with an attorney.
-
Step 20: Insert signature blocks.
-
Step 21: Sign in front of a notary public.
-
Step 22: Keep a copy.
Detailed Guide
At the top of the page, insert the title: “Nonmarital Cohabitation Agreement.” Make the words bold or underline them.
In the first paragraph, you need to lay out the facts about the parties: name, address, as well as the date the agreement is entered into.
For example, you could type, “Agreement made this 12th day of June, 2016, by and between Ashley Smith (“First Party”) and Ben Jones (“Second Party”), who reside at 1234 Alphabet Drive, Chicago, Illinois.”, In the second paragraph, you explain why this contract is being created.
For example: “The Parties desire to establish their rights and responsibilities with respect to each other’s property and income, as well as any property and income they may acquire, either separately or jointly, during the cohabitation.”, You need to state that each person has made complete disclosures about finances and debts to the other person: “Each Party has made a full disclosure to the other Party concerning their debts and assets.”For this reason, it is a good idea to sit down before drafting the contract.
You should gather all of your financial information and meet with the other person. , A valid contract requires “consideration.” This is what you give up in order to make the contract.
You should explain the consideration in a separate paragraph.
Typically, in a cohabitation contract, the consideration is your promise to abide by the contract.
You could write something like this: “Consideration consists of the mutual promises contained in this agreement and of the promises of each Party to act as the living companion to the other.” , You need to explain how rent (or a mortgage) will be divided between the two of you.
There are two ways to divide the rent: assign a dollar amount to each person or assign a percentage.
You should probably assign rent (and any other expense) as a percentage.
Your rent and other expense can increase each year, and you don’t want to redraft the contract each year.
As you divide up expenses, you should create three columns.
Label the first column “Monthly Expenses,” and underneath put “rent” or “mortgage.” Label the second column “First Party” and the third column “Second Party.” Underneath, write the percentage each person will pay for each expense.If you decide to divide expenses in half, then each person will pay 50%. , After rent, you need to divide up your utilities.
Common utilities will include:telephone gas electricity water and sewer garbage collection cable television internet service property taxes , If you took out debts with the person you are living with, then you will need to divide the debts.
Assign a percentage, just as you did to utilities:car or truck payments home equity loans other loans credit cards day care , You should decide how you will divide household expenses such as food and home improvements.
Go through and assign a percentage to the following:groceries school lunches (if you have children) cleaning supplies or services yard maintenance home maintenance and improvements home security appliances home furnishings , You can also decide ahead of time how you want to divide personal expenses like entertainment, travel, eating out, or pet-care costs.
Some people might not want to get into this level of detail; instead they might only want to divide the big costs.
However, if you want to allocate personal expenses, then do so for the following:take-out meals entertainment gifts travel any hobbies pet care babysitting , Although you will be living together and sharing common expenses, you probably want to maintain ownership of your individual property.
This is property you bring into the house for your own benefit.
It also includes anything you bought for yourself without an intent to share.
You might want to include a few provisions regarding the following:
Individual income: “The parties shall keep the following property as separate property:
Individual earnings, salary, or wages acquired both before and after the execution of the Agreement.” Gifts: “Individual gifts, devises, inheritances, or bequests acquired both before and after the execution of this Agreement.” Property: “All real or personal property, owned by a Party at the date this Agreement is executed, to include all proceeds or income derived from these properties.” , You might be worried that by living together you are creating a common law marriage.
If you did, then either of you might be entitled to support and maintenance after you separate.
You can waive any support or maintenance in the contract: “The Parties waive the right to ‘palimony’ or any other form of maintenance or support, both permanent and temporary.”, Likewise, you should expressly waive the right to share in each other’s estates at death: “The Parties waive the right to share in each other’s estates on death.”, Sometimes cohabitants will disagree on something.
For example, you might disagree about whether to install a landline phone.
Or you might disagree about who gets joint property if you separate.
You should include a provision stating that you will try to resolve disputes in mediation.
For example, you could write, “In the event a dispute arises between the Parties, the Parties agree to participate in mediation.
They will participate in at least four hours of mediation in accordance with the United States Arbitration & Mediation procedures.
The parties agree to share equally in the costs of mediation.”, If you go to court, then a judge will need to interpret the contract.
You can decide which state’s law to use.
Generally, you will use the law of the state you live in.
A sample provision might read: “This Agreement shall be governed by the laws of the State of Illinois.”, This clause states that the written contract contains the entire agreement between the parties.
It is important to have because you don’t want the other person claiming that you had an oral side agreement.
Here is a sample merger clause: “The Parties intend that this Agreement is the full and complete agreement between the parties regarding their cohabitation.
There are no other agreements, oral or written, between the Parties regarding the cohabitation.
The Parties can modify this Agreement only by a writing executed by both Parties.”, If you end up in court, then the judge might find that one provision in your cohabitation contract is illegal.
When that happens, the judge has to decide whether to sever that provision and keep the rest of the contract or void the whole contract.
A severability clause tells the judge to sever any illegal part of the contract but enforce the remainder.
You could write, “If any paragraph or provision of this Agreement is found invalid, void, or unenforceable, then it is the intent of the Parties that the remaining parts should continue in force and effect.”, After you have typed up the contract, you should have an attorney go over it with you.
A cohabitation contract is a valid contract.
You should fully understand your rights and responsibilities.
To find an attorney, you can contact your local or state bar association and ask for a referral.
If you don’t have much money, you should read Hire a Lawyer When You Have Low Income for tips on getting low-cost legal help. , Include a line for both people to sign individually.
Above the signature line, include the following:“I have read the Agreement and have spent time considering its implications.
I fully understand the contents and I agree to its terms.
I voluntarily submit to the execution of this Agreement.”Add lines for witnesses.
You should probably have two witnesses observe the signing.
Include a signature line for them as well. , You should sign the contract in front of a notary.
Although not required in every state, having the contract notarized can help resolve disputes later on about whether the contract is valid.
You can find a notary in most courthouses or large banks.
You can also use the locator feature at the website for the American Society of Notaries.Make sure that you take personal identification to the notary.
A valid passport or driver’s license should be acceptable. , Store your copy of the cohabitation agreement in a safe place.
You will want to refer to it later should a dispute arise.
About the Author
Emily Jimenez
Professional writer focused on creating easy-to-follow home improvement tutorials.
Rate This Guide
How helpful was this guide? Click to rate: