Definitely. With the large financial and emotional commitments involved in owning a home it's particularly important to have a clear understanding going into the purchase. There are four major areas, at a minimum, that need to be covered:
How much of the house do each of us own?
You can decide on any kind of split you want, but be sure to put it in writing. If it's not 50-50, can the person who owns less than half increase his share - for example, by fixing up the house or making a larger share of the mortgage payment? Spell it out.
How will our ownership rights be listed on the deed?
One choice is as "joint tenants with rights of survivorship," meaning that when one of you dies, the other automatically inherits the whole house. The problem with this option is that joint tenancy is not severable unless both parties agree to transfer their interest to another at the same time. This can create problems if you split up and one of you wants to sell but the other refuses.
Another option is "tenants in common," meaning that when one of you dies, that share of the house goes to the beneficiary named in a will or trust, or to blood relatives if the deceased partner left no estate plan. Of course you can each specify the other as beneficiary.
What happens to the house if we break up?
Will one of you have the first right to stay in the house (perhaps to care for a young child) and buy the other out, or will the house be sold and proceeds divided? There are many options.
If one of us has a buyout right, how do we decide on its value, and how long will the buyout take?
The best way to determine value is to select a fully licensed appraiser. In Michigan, they are the only ones who can testify to the value if it is needed. Realtors are NOT qualified to do appraisals; all they can do is give you "comparables" which may or may not reflect actual market value. An appraisal is not expensive and is always worthwhile. Markets change with economics and so do values. You can agree beforehand to use one fully licensed appraiser or allow the option for each to choose your own. (Note: In our work with appraisers, they indicate that good appraisals should be within 5% of each other. Selecting one qualified appraiser thus saves you the cost of two needless appraisals.) In buyout situations, the purchasing partner often gets one to five years to pay off the other.