Karen and Tim have been living together happily for a couple of years and are planning to buy a new home together.
Karen went through a messy divorce five years ago and kept her family home from the settlement. As a single mother to two teenage children, she feels a strong responsibility to protect her financial security for her kids’ future.
Tim, with his own past divorce and three children, can’t contribute much financially to the new property, but he has a stable job and a good income.
They plan to use some of the equity from Karen’s home for the deposit, and they will take out a joint loan, which they will share equally.
Karen is concerned about the financial risks of using the equity in her family home as a deposit for a new property with her partner. She wonders what will happen to her initial contribution if their relationship fails, and is understandably anxious about protecting her family home from any potential future claims. She spoke to a local law firm and they quoted $8,000 to arrange a Binding Financial Agreement which only added to her stress.
But without a Binding Financial Agreement (BFA) in place, there’s a risk that the new property would be divided equally between them, which wouldn’t account for Karen’s larger financial input.
A BFA ensures that Karen can protect her equity by specifying that she will get her money back before any division occurs. Without one, if the relationship ends and a contested property settlement arises, they could both end up in a lengthy and costly legal battle. Worse still, her new partner could also gain an interest in her family home since she brought most of the assets into the relationship. This would leave her vulnerable to losing a significant portion of her original property, even though they only contributed to servicing the debt together.
By securing a BFA, Karen can prevent these complications and protect her financial interests.
Tim understands that he isn’t bringing established assets to the relationship and sympathises with Karen’s anxiety. He recognises that her concerns have the potential to cause friction between them. They both want to set clear ground rules now, while their relationship is strong, to prevent any future disputes. Tim knows that by helping Karen feel more secure and relaxed in their relationship, it will ultimately benefit them both.
Karen and Tim realised they needed a practical and affordable solution to protect their financial interests without adding to their stress. They wanted a legally binding agreement that would be both effective and budget-friendly, and that’s when they found RP Emery’s Binding Financial Agreement (BFA) kits.
These kits offer exactly what they need—a cost-effective way to create a customised, legally binding agreement without the high costs of traditional legal services. By using RP Emery’s BFA kits, Karen and Tim can set clear ground rules that protect Karen’s equity in the new property and define their financial contributions, giving them both the security and peace of mind they seek as they move forward together.
RP Emery’s legal review service ensures their agreement is thorough, compliant, and tailored to their specific needs, offering peace of mind without the hefty costs or drawn-out legal processes.
Just like Karen and Tim, you can protect your financial future with RP Emery’s Binding Financial Agreement kits. Take the first step toward security and peace of mind—download your kit today.
Disclaimer: While this case study reflects a common scenario based on real customer experiences, names and details have been changed and paraphrased for privacy.
Other Resources
De facto Relationships in Australia
Financial Agreements for de facto couples living together
Financial Agreements for de facto couples planning to live together