Most unmarried couples and cobuyers own their home, in equal or unequal interests, as tenants in common. But this can sometimes cause complications. Consider an example in which two men, Frank and Jeff, own a home together. Frank wills his share of the house to his twenty-four-year-old daughter Kate, who lives 2,000 miles away. When he dies, Kate is left with half of a house on the other side of the country. What is Kate to do with the house? She hardly knows forty-two-year-old Jeff. Her options are to sell her share to Jeff; rent her share, with Jeff approving of the tenant; or sell the house with Jeff, with the two splitting any profit. Here is a perfect example of the need for a contract between co-owners, spelling out every possibility as it applies to them and the property.

As you've seen, the contract should cover how the home is owned in the legal sense, what will happen in the event the co-owners separate — whether the house will be sold then or at any other specified time — and how the proceeds from a sale will be split. There can be clauses covering any decision about the termination of the agreement — such as upon the death of one partner, upon marriage to each other, or upon marriage to someone else — or just a mutual agreement in writing about termination. A contract can contain as many stipulations as the parties choose, regarding any aspect of owning and maintaining the property.

Finally, you might also specify in a contract that any disputes you both (or all) cannot resolve will be turned over to the American Arbitration Association for settlement. Sometimes, only a qualified outsider can come up with a solution to a heated disagreement.