‘What may go unsuitable? Yikes, fairly a bit’: Zooey Deschanel’s newest dwelling buy might be a dangerous gamble — here is why

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Zooey Deschanel and her HGTV star boyfriend Jonathan Scott announced this week that they have bought their dream home in Los Angeles.

For unmarried couples, buying a home together can turn into a nightmare if they don’t take the right steps to secure themselves financially and legally.

In an excerpt from the magazine that Jonathan Scott shares with his twin brother Drew, the “Property Brothers” star describes the journey he and Deschanel took while buying a house. Scott described his girlfriend as a real estate lover and described her as “one of those ‘Friday Night Zillow’ guys”.

“We both like old houses – the intricate details, the wood floors, the vintage hardware,” writes Scott. “We like a home that feels special and loved, with its own unique story.”

Zooey Deschanel bought a Georgian-style house in Los Angeles with her boyfriend, HGTV star Jonathan Scott.

An early search for a potential home to share resulted in only two properties that met the couple’s criteria – and they eventually bought one, though they began the search essentially on a whim. The property in question, a Georgian-style house designed in 1938, required significant renovations, which the couple intend to elaborate on in upcoming issues of the magazine.

Aside from tackling structural issues, including adapting the home to California earthquake regulations, the two also strove to make it an environmentally friendly place to live. Scott said the house does not rely on fossil fuels for heating or cooling and uses state-of-the-art insulation.

While Deschanel and Scott may still be on their honeymoon dreaming of their future in the home, financial experts warned that unmarried couples should be careful about home ownership.

“What could go wrong? Yikes, pretty much,” said Thomas F. Scanlon, a certified financial planner and accountant based in Manchester, Conn.

(A representative from Deschanel declined to comment, while representatives from Scott did not respond to requests for comment.)

The law is not on your side

Real estate laws in most parts of the country are geared towards married couples, financial and legal experts warned. For unmarried partners who choose to purchase communal property, it can leave them without an important safety net.

“Most states have some form of ‘homestead law’ that automatically protects spouses from the undesirable consequences of a spouse’s death,” said Austin Frye, an estate lawyer and president and founder of the Frye Financial Center in Aventura, Florida. “This protection is usually not extended to unmarried couples.”

Those laws, Frye said, will allow a widow or widower to live in the property for the rest of their lives, even if the title is in their deceased spouse’s name, as the title will automatically pass to the surviving spouse.

“Should the relationship break up, neither party has any financial or legal protection.”

– Sallie Mullins Thompson, financial planner and tax strategist based in Washington, DC

When a couple separates, divorce laws make it easier to dissolve property. Most states divide property acquired during marriage fairly – while in “jointly owned” states, property acquired during marriage is usually divided in half when it is joint property.

For unmarried couples, “Should the relationship break up, neither party has any financial or legal protection with respect to monies and assets that are put into the home at any time during the purchase and during the relationship,” said Sallie Mullins Thompson, financial planner and tax strategist based in Washington, DC

How unmarried couples can protect themselves – and their investment

Forward planning is critical to ensuring that each partner – and their heirs – are protected in these agreements, experts argued.

“Before you buy, consider what you would like to do if the unexpected occurs,” suggested Linda Farinola, president of New Jersey-based Princeton Financial Group.

To get started, experts recommended unmarried couples to draw up a document that resembled a prenuptial agreement, sometimes called a cohabitation or co-ownership agreement. Not only would such a document set out how the property would be divided up in the event of a separation, but it can also cover more mundane issues such as expectations of the cost of maintenance. Hopefully such an agreement would save an unmarried couple a major legal battle.

The way the title of the house is held can aggravate the consequences of a partner’s death.

End-of-life planning is another aspect here. Depending on the form of the document with which the assets are managed, they cannot be transferred directly to the surviving partner in the event of death. In such a scenario, other heirs could be entitled to this share of the house. Unmarried couples can avoid such inconvenience by requiring that the surviving partner inherit the stake when they die, and not someone else.

The form and use of the title can also be particularly important for unmarried couples. A preferable option, according to Farinola, might be to hold the property as a joint tenant, as each person would have a 50% stake. But other options are possible, she said, such as owning the house through an LLC with an operating agreement or through a trust.

“In this case, the parties can agree at the outset how things should be broken down into different scenarios,” said Farinola. “The downside is that it complicates things.”

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