Navigating joint property purchases in relationships requires careful financial discussions, as contributions may not be equal. Notary Nathalie Couzigou Suhas highlights the necessity of clarifying ownership shares to prevent complications during breakups or deaths. Couples must address financing, renovations, and contributions upfront. While married partners have broader rights, cohabiting couples face a five-year limitation for claims. Accurate ownership reporting fosters healthy relationships and reduces potential disputes, with options available for correcting discrepancies if needed.
Understanding Joint Property Purchases in Relationships
It’s an exciting milestone: you and your partner have decided to dive into a joint real estate venture. You’ve found the perfect property, and your mortgage has been approved. The final step is to meet with the notary to finalize the purchase.
However, as you prepare for this significant investment, it’s crucial to discuss the financial contributions involved in the purchase. Depending on your respective incomes and assets, it’s likely that the financial contribution may not be evenly split, with one partner potentially investing more than the other. Despite this, many couples shy away from these important discussions.
“Often, couples focus on the excitement of buying a property together and overlook the details of their ownership shares,” explains Nathalie Couzigou Suhas, a Paris-based notary. Borrowers frequently assume a 50-50 ownership even when the financial contributions differ.
Why Open Dialogue About Financing is Essential
While these discussions may seem trivial or mundane during the blissful moments of love, they become critical in the event of a breakup or the death of one partner. This is particularly important if one partner has children from a previous relationship, as they may seek claims against the surviving partner. “Love doesn’t exempt us from needing to clarify the financial aspects of our property,” emphasizes Nathalie Couzigou Suhas. It’s vital to ask the right questions: who is financing the property? Are renovations planned? What contributions does each partner bring?
Practically speaking, how can couples navigate this? “The notary will determine the acquisition percentages based on financial contributions as well as repayment capabilities,” Nathalie Couzigou Suhas explains. A detailed table will be created to document all financing elements, attributing a percentage of ownership to each partner.
In the event of a separation, discrepancies in reported contributions can lead to complications. “If a property is declared as 50-50, even if one partner contributed 70%, they will only own 50%,” the notary cautions. Such situations can exacerbate tensions during already challenging times.
Fortunately, even if you initially declared a 50-50 ownership, there may still be ways to assert a different reality depending on your circumstances. For couples married under the community property regime, one spouse can inform the notary in advance about personal financing contributions to claim them during a divorce. Without this, assets acquired during the marriage are considered communal.
For couples with a marriage contract, the situation differs: “Under a separation of property regime, one can still make a claim,” reassures Nathalie Couzigou Suhas. However, proof of a larger contribution or early loan repayments will be necessary.
It’s noteworthy that the Court of Cassation views staggered repayments as contributions to household expenses. Therefore, a borrower paying a slightly larger loan portion monthly would not be able to make a claim during separation.
Limitation Period for Cohabiting Couples
Be aware that while married individuals can assert their rights at any time, cohabiting couples face a five-year limitation period. Consequently, if a cohabiting partner has financed a greater share of the property, they cannot claim their due after this period.
“It’s always best that the reported ownership matches the actual financial contributions,” concludes Nathalie Couzigou Suhas. Clear financial arrangements enhance relationships and help avert potential disputes.
If you believe you’ve made a mistake regarding ownership shares, adjustments can be made, but they can be costly. The tax authorities may classify this as a sale, imposing approximately 6% fees on the altered share. An alternative solution is to execute a debt acknowledgment with a notary for a few hundred euros, allowing one partner to recover their due in case of separation.