Cohabitation Agreements Protect the Partners

A growing number of unmarried couples sign cohabitation agreements  (or cohabs), which are binding contracts that bear a striking resemblance to prenuptial agreements. Cohabitation agreements, which are prepared by attorneys, protect personal assets, and often address the same issues prenups regularly do, including child custody and support obligations.

“We’ve seen a real dramatic increase,” Ken Altshuler, president of the American Academy of Matrimonial Lawyers (AAML) said. “A lot more people are delaying, or forgoing, marriage and people are realizing as you get older, you have more things to protect.”

Often, partners cohabitate as a preliminary to marriage as a way of reducing living expenses. Sometimes same-sex partners who might otherwise marry cohabitate because they live in a jurisdiction where such marriages are not recognized. And sometimes older people “shack up” to avoid upsetting family or friends through remarriage.

Cohabitation between unmarried partners has increased 1,150 percent in the last 40 years, and the concept of cohabitation now includes any two partners, heterosexual or same-sex, who integrate their residence, property and daily lives. Sometimes this is a preliminary before marriage, but can also be an ultimate arrangement for partners who don’t want the social, personal and legal commitment of marriage.

Unless a heterosexual or same-sex couple defines their partnership through a legal contract, the law may view them as strangers in the event of a breakup or death. Cohabs can be used to guarantee financial security in a fair settlement, properly compensate a caretaker partner, limit exposure in the event of a breakup, and disclose expectations both financial and personal. For example, if a partner stays home to care for children “a cohabitation agreement would specify the rights and support for each party in the case of a break up,” said Silvana Raso, matrimonial attorney with Schepisi & McLaughlin in Englewood Cliffs, New Jersey.

Make no mistake; Cohabs are not prenups, or vice versa. A cohab cannot be used after a marriage because it lacks the same force and effect as a prenup. Cohabs are governed almost exclusively by general contract principles. A prenup takes effect only upon marriage; a cohab usually isn’t valid once the parties marry.

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