How is Joint Property Separated Between Unmarried Couples?

What Constitutes Shared Property in a Relationship?

A marriage license constitutes a legal, binding agreement between two people. Should those two people decide to divorce, there are laws in place that prevent one spouse from taking all the marital assets. Michigan operates under equitable distribution rules rather than community property rules. Under community property rules all marital assets are split equally—50/50, regardless of who made more money. Under equitable distribution, marital assets are split fairly, but not necessarily equally. When a couple lives together unmarried—and without a written agreement—it can be much more difficult to determine who gets what as it pertains to property rights. According to Psychology Today, in the 1970s only a tiny fraction of the U.S. population—0.2 percent—lived as cohabitating romantic partners. Today, that number is about 15 percent among the 18-34 age bracket   

A verbal agreement between the two of you is simply not sufficient when unmarried couple property rights come into play. You may have verbally agreed that you would do all the work on the fixer-upper house your partner bought, yet when you split up, his or her name is the only one on the deed. Your hard work and money could be lost without a written agreement.    

If you’ve lived together for a significant length of time, you and your partner may both consider your property to be “shared.” Homes, vacation homes, and timeshares, along with the following can be an issue should the two of you split up.     

• Joint bank accounts can make shared goals much easier. But what happens if the two of you split up? Horror stories abound regarding one partner emptying the joint bank account. While there is some recourse for such an action if you are legally married, little can be done if you are not—unless you have a written agreement in place. While one partner may be able to freeze the account so there is a “snapshot” as of the date of the split, the other may just as easily unfreeze the account.  
• Joint investments are much like joint bank accounts—without a written agreement, the investment could be sold by an aggrieved partner without the other’s permission.  
• Shared cars can be a problem if only one car is shared between two partners. You may need to sell the car and split the proceeds. If you are both on the car loan, you are both responsible for ensuring the payments continue to be made, but if you cannot agree on who will be responsible for the debt and physically have the car, one of you could be left without a vehicle.  
• Furniture should theoretically go to the partner who paid for it, but there can be many nuances associated with such a purchase—perhaps one partner paid for the furniture, but it was a gift to the other.  
• Shared pets can be almost as difficult when a couple splits as a child custody case. If both partners care about the pet and take care of the pet problems in the case of a split can be serious. Do you split “custody” of the pet, or do you agree that one partner will take the pet and the other will have “visitation” rights? Again, without a written agreement, your partner could conceivably just take the pet and it could be very difficult to get the pet back.  

What Are Unmarried Couples’ Rights When It Comes to Property Division? 

As you can see, unmarried couple property rights can turn into a serious issue without a written agreement between the two of you. If there are no children from the relationship, the starting point in dividing assets is that neither partner will have ongoing financial obligations towards the other. Each partner will keep assets or income that is in their sole name 

Separating unmarried partners will usually divide assets held jointly in accordance with legal ownership—i.e., who paid the most for the asset, or put the most money in a joint bank account. This is assuming both partners are being reasonable. If reasonableness is not a part of the split, one partner may argue that they should receive a larger share. With no written agreement in place—and no agreement—a judge may end up deciding the issue.    

Who Gets the House When an Unmarried Couple Splits Up? 

The house you share could be one of the most difficult properties to split, although if you have shared vacation properties or timeshares, they may follow in difficulty. Without a joint house ownership agreement that sets forth your intentions in the case of a split, there is really no way to tell how the property will be split. If your partner is angry and feeling vindictive, you could find yourself with nothing if your name is not jointly on the deed.   

If your name is on the deed, you can either sell the property and divide the net proceeds or agree for one partner to remain in the house and buy out the other’s share. If there is no agreement between the two of you there may be a legal presumption that the proceeds should be split 50/50. This may or may not be equitable in your situation. Perhaps you put in the most money when purchasing the house, and you paid for all the upgrades and repairs. A court may still find your partner is entitled to half the house, vacation home, or timeshare.    

How Attorney Melissa Pearce Can Help You and Your Partner Divide Your Assets

If you are concerned about Novi, Michigan unmarried couple property rights, it is essential that you speak to a knowledgeable attorney like Melissa Pearce. You can be scheduled for a virtual pre-engagement meeting that allows us to discuss your issues, as well as your goals. While property separation has the potential to cause arguments and anger, Melissa will work to minimize the emotional and financial harm suffered from your split. If your only goal in the process is revenge, then our firm may not be the best one for you. We are professional and respectful to each client and will handle your property division issue in a way that ensures the best possible outcome. Contact Melissa Pearce & Associates, PLC today!