But that’s exactly what happened to Nora, who asked Global News to change her name for privacy reasons.
Nora and her boyfriend dated for about three years before they decided to buy a house together in an Ontario suburb.
At the time, she was given financial advice to put the home in her name because she was earning more money while her partner was finishing school. Nora also took advantage of the government’s first-time homebuyers tax credit.
Only a year after living in the home together, Nora and her boyfriend split. They didn’t have any formal agreement about their property and who would be responsible for paying what.
Their mortgage was in Nora’s name, and the couple had another personal loan, too.
“I ended up getting a lawyer because I was very unsure [of my rights] and it was a ton of money we were talking about,” Nora said.
“She unfortunately advised me that he could get up and walk away if he really wanted to, and I would have to take him to court to try and get the money that he owed,” she said.
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Thankfully, Nora and her ex-boyfriend came to an agreement through her lawyer. The pair decided they would sell the house, and he would be responsible for his half of their outstanding debt.
“I was, in all honesty, very lucky, but it was incredibly stressful,” said Nora.
“I had no idea the sort of risk I took.”
The importance of a cohabitation agreement
Nora’s experience is not that uncommon. More Canadians are in common-law relationships today than in the past, data shows, and many are buying homes together.
More than one-fifth of all couples — 21 per cent — were living common law in 2016, according to Statistics Canada. This is a big jump from about 6 per cent in 1981.
What’s more, the government agency says many adults now choose to live common law before marriage. The latest available data found that 39 per cent of married 25- to 64-year-olds lived common law with their current spouse before getting married.
But common-law partners don’t have the same rights married couples do, and many don’t understand the risks of buying a home together, says Diana Isaac, a family lawyer at Toronto’s Shulman Law Firm.
In Ontario where Isaac practices, common-law couples do not have any automatic rights to property like married couples do. This means if a couple lives together but their home is only in one person’s name, as in Nora’s case, a cohabitation agreement is important.
A cohabitation agreement is essentially a contract that outlines how a couple will deal with assets like property and spousal support should they break-up or one person dies, Issac says. It helps prevent future legal issues, and clearly outlines who owns what.
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These agreements are especially vital if property is only in one person’s name (i.e. “on title”) but both parties put money into it. Cohabitation agreements are also valuable when one partner moves into another person’s house, and begins contributing to the household.
This is because if a couple splits, each person keeps whatever they technically own — including property.
“If the person is not on title and they have contributed to the home, the title would take precedence,” explained Isaac.
“The individual that is not on title would have to prove their contributions by way of a trust claim in order to have an equitable interest, which becomes very complicated and very costly.”
In cases like Nora’s, if she and her boyfriend didn’t come to a post-split agreement, she would have been on the hook for the house, Isaac said.
“When that mortgage statement comes through and your name is on there, you’re responsible for it.”
Laws vary across Canada for common-law spouses
Common law legislation varies from province to province. In Ontario, couples are considered common law if they’ve lived together for three years or more. If they have a child together, a couple becomes common law sooner.
In B.C., couples are considered common law if they’ve shared a home in a marriage-like relationship for at least two years, or they’ve lived together under two years but have a child together.
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The Civil Code of Quebec currently does not recognize common-law couples (or “de facto spouses” as they’re called in the province).
In 2013, the Supreme Court of Canada ruled that Quebec does not have to give common-law spouses the same rights as married couples. However, the government says de facto unions can obtain a degree of protection by drawing up a cohabitation contract.
In 2018, efforts were put forward to change Quebec’s legislation regarding common-law couples.
In Manitoba, all laws in the province governing property rights of married couples are applicable to common-law partners who have been living together in “a conjugal relationship for at least three years.” Common-law couples can also register their relationship at the Vital Statistics Agency.
It is important couples understand the laws in their province so they can make informed decisions. Isaac suggests couples talk to a lawyer to draft cohabitation agreements prior to moving in together.
Nora wishes she knew about Ontario’s laws earlier. She wants unmarried partners to know it’s important both parties protect themselves if they’re going to put money into property together.
If her ex didn’t agree to cover his half of their home, it would have been up to her to figure it out.
“When it was deemed that there was no way this relationship was going to be salvageable … I had no interest staying in [the house],” she said.
“It just had too many bad memories.”
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