A practical legal article in Philippine context (for education, not legal advice).

1) Why this topic matters

Foreigners often form long-term relationships with Filipinos and plan to buy a home, build a house, or invest in real estate while living together (married or unmarried). In the Philippines, however, land ownership is tightly restricted, and relationship status affects who owns what, what can be reimbursed, and what courts will enforce if the relationship ends or one partner dies.

A cohabitation agreement (sometimes called a “domestic partnership agreement” or “property agreement”) can help set expectations about money, contributions, and use of property. But it cannot legalize what the Constitution prohibits—and if drafted badly, it can create tax problems or be treated as an unenforceable attempt to evade ownership restrictions.

2) Core legal framework you must understand first

A. Foreigners and land: the constitutional rule

As a general rule, foreigners cannot acquire private land in the Philippines. This includes direct purchase and many indirect schemes that effectively transfer beneficial ownership. Limited exceptions exist (notably hereditary succession, i.e., inheritance).

Practical effect: If the “property” you mean is land (a house-and-lot, vacant lot, farm land), title generally cannot be in the foreigner’s name (unless an exception applies).

B. Foreigners and condominiums: often allowed

Foreigners may acquire condominium units, subject to the common restriction that foreign ownership in the condominium project cannot exceed the allowed threshold (commonly discussed as 40% foreign ownership in the condominium corporation). This is why many couples choose condos rather than landed property.

C. Alternatives foreigners commonly use (each has legal limits)

Long-term lease (foreigner leases land/house; Filipino owns)
Condominium purchase (foreigner buys unit; check foreign ownership cap)
Ownership via a Philippine corporation (often cited 60/40 Filipino/foreign equity rules; must be structured carefully and lawfully)
Rights short of ownership (usufruct, certain contractual rights, etc.)

A cohabitation agreement should be built around lawful structures, not around “side agreements” that contradict constitutional limits.

3) What a cohabitation agreement can and cannot do

What it can do (when properly drafted)

A cohabitation agreement can validly cover:

Living arrangements and expenses
- Monthly contributions, budgeting, support, household purchases
Ownership of personal property
- Furniture, vehicles, appliances, bank accounts (subject to banking rules)
Treatment of contributions
- Whether payments are gifts, loans, rent, or reimbursements
Exit plan
- What happens if you separate: move-out timeline, buyout options, sale process
Dispute resolution
- Mediation/arbitration clauses (within legal limits), choice of venue
Confidentiality (limited enforceability; cannot stop lawful reporting)
Documentation duties
- Receipts, bank transfer proofs, inventory lists, periodic accounting

What it cannot do

A cohabitation agreement cannot:

Give a foreigner ownership of land in a way the Constitution forbids
Create an enforceable “beneficial ownership” arrangement that a court will treat as a circumvention
Override mandatory family/property rules when they apply (especially for married couples)
Validate donations that Philippine law treats as void in certain cohabitation situations (explained below)

4) Relationship status changes the default property rules

A. If you are married (or think you are)

Marriage triggers default property regimes (depending on the date of marriage and any valid prenuptial agreement). Even if married to a Filipino citizen, a foreign spouse generally still cannot own land.

Key implications:

Titling land in the Filipino spouse’s name is common—but the foreign spouse should understand that titling often controls, and courts may be hostile to arrangements that look like evasion.
A “side agreement” saying “the land is really the foreigner’s” is high-risk and may be unenforceable.

Important: If you are married, you should talk to counsel about the couple’s property regime and what contracts are allowed between spouses.

B. If you are not married, the Family Code rules on unions apply

Philippine law addresses property relations in unions without a valid marriage (commonly invoked provisions are those on co-ownership and contributions in such relationships). The treatment depends on whether you are legally free to marry each other and on good faith.

Two big practical takeaways:

Courts look closely at proof of actual contributions.
Some arrangements—especially those that look like donations between partners living as spouses—can be attacked as void under Philippine rules on prohibited donations in certain relationships.

5) The land problem: what foreigners often try—and why it’s risky

Common scenario: “Put it in the Filipino partner’s name; we’ll sign an agreement”

Couples sometimes:

buy a house-and-lot titled to the Filipino partner, and
sign a private document saying the foreigner “really owns” it or will be repaid.

Risk: If the agreement is interpreted as giving the foreigner beneficial ownership of land, it may be treated as an unlawful circumvention and become unenforceable. In litigation, that can mean:

the foreigner cannot enforce “ownership,” and
even reimbursement claims can be uncertain if the court finds an illegal scheme.

Better legal framing: focus on lawful rights, not land ownership

If land must be in the Filipino partner’s name, a cohabitation agreement is safer when it focuses on:

Lease arrangements (if the foreigner is paying for use)
Loan and reimbursement structures (with clear repayment terms, interest if any, and security that does not violate restrictions)
Ownership of removable personal property and documented improvements (carefully—because buildings/fixtures can become part of the land)

6) Safer property paths for couples (and how agreements support them)

Option 1: Condominium ownership in the foreigner’s name

Often the cleanest route for “real property” use.

Agreement focuses on:

who pays the down payment, amortization, dues, taxes
what happens if you separate (sale, buyout, who gets proceeds)
how to handle improvements and furniture
whether payments are gifts, rent, or shared investment

Due diligence:

confirm foreign ownership capacity in the project
check title status, developer issues, dues, restrictions

Option 2: Long-term lease (landed property)

If the couple wants a house-and-lot lifestyle:

Filipino partner owns the land/house, and
foreigner gets occupancy via a formal lease.

Agreement structure:

a notarized lease with clear term, renewal, rent, escalation, repairs
rights on separation (notice periods, early termination, refund rules)
treatment of improvements (who pays, who owns them, restoration obligations)

Why this helps: It defines the foreigner’s rights as use/possession, not ownership.

Option 3: Build on leased land (with extreme care)

Couples sometimes lease land (owned by the Filipino partner or family) and build a house using foreigner funds.

Major caution: Under Philippine property principles, buildings and land are usually linked by accession; the legal ability for someone other than the landowner to own a building is complex and fact-specific. If you’re considering this, treat it as a lawyer-required scenario.

Your agreement should address:

building permits and whose name appears
what happens to the structure on termination (buyout formula, removal if possible, valuation method)
registration/annotation possibilities and enforceability against heirs

Option 4: Corporate structure

A corporation may hold land if it meets Philippine nationality rules and other requirements.

Caution: If the corporate structure is merely a dummy arrangement to give control/benefit to the foreigner, it can create serious legal exposure. If legitimate, agreements should address:

shareholding, voting, board control, and deadlock
shareholder loans vs capital contributions
exit rights, valuation, transfer restrictions
compliance and reporting

7) The most important drafting choice: define payments clearly

Many disputes come down to one question:

“Was the foreigner’s money a gift, a loan, rent, or an investment?”

Your cohabitation agreement should classify each major cash flow:

A. Gifts

Gifts can trigger:

tax issues (donor’s tax concepts)
validity problems in certain relationships (Philippine law restricts donations between certain partners living together as spouses)

Avoid casually labeling big transfers as “gifts” unless that is truly intended and legally safe.

B. Loans (often the most practical)

If the foreigner is funding the purchase titled to the Filipino partner, a loan framing is often more defensible than “beneficial ownership.”

A robust loan section includes:

principal amount and disbursement schedule
interest (or explicitly none)
repayment schedule, grace periods
default terms and remedies
evidence: bank transfers, receipts, acknowledgment

Security: Be careful. Mortgages and liens must comply with property and registration rules; and “security” that effectively gives land ownership/control to a foreigner can be challenged.

C. Rent / occupancy payments

If the foreigner is paying to live in a house titled to the Filipino partner, classify as rent or shared household expense to avoid later “equity” claims.

D. Shared investment (condos, movable assets)

Where foreign ownership is allowed (e.g., condo unit), you can define equity shares and proceeds splitting.

8) Separation planning: the clauses that prevent chaos

A practical cohabitation agreement should include:

Triggering events
- breakup date definition, moving out, marriage, death, long absence
Immediate use and possession
- who stays temporarily, who pays bills during transition
Buyout option
- one partner may buy the other out using a valuation method
Sale process
- broker appointment, listing timeline, reserve price, price reductions
Expense allocation
- taxes, dues, repairs, insurance, legal fees during sale
Inventory of personal property
- attach schedules for appliances, furniture, vehicles
Accounting and reimbursements
- how to compute net proceeds and reimbursements
Dispute resolution
- mediation first; then courts/arbitration depending on enforceability

Valuation method: specify whether to use:

independent appraiser(s)
zonal values (not a market substitute, but sometimes referenced)
average of two appraisals
agreed depreciation schedule for improvements and furniture

9) Death and inheritance: cohabitation agreements are not wills

A cohabitation agreement can state intentions, but it is not a substitute for estate planning.

Key points:

A foreigner may be able to acquire land by hereditary succession (inheritance), but the scope and circumstances matter.
If the property is titled to the Filipino partner, and the partner dies, the property usually passes to the partner’s heirs. A cohabitation agreement may not stop heirs from asserting rights if the agreement is defective or contrary to law.

Practical tools to consider (with counsel):

a properly executed will (for the Filipino partner) within Philippine rules on legitimes
beneficiary designations for insurance
clear titling for condos or movable assets
documented loans payable by the estate (if that’s the structure)

10) Formalities that matter in the Philippines

A. Notarization is a big deal

Many documents gain stronger evidentiary weight when notarized. A cohabitation agreement should generally be notarized to avoid later claims of forgery or lack of consent.

B. Registration/annotation (when applicable)

Certain instruments affecting real property rights (leases of certain lengths, mortgages, etc.) may need to be registered/annotated with the Registry of Deeds to be enforceable against third parties.

A private, unregistered agreement can be vulnerable if:

the titled owner sells to someone else, or
heirs deny knowledge, or
creditors attach the property.

C. Immigration and address realities

Foreigners living in the Philippines often have visa compliance needs; agreements sometimes include:

who pays visa costs, travel, medical insurance
what happens if one partner must leave the country

These are contractual issues, not property law, but they reduce conflict.

11) Taxes and “hidden” costs your agreement should anticipate

Even if your agreement is valid, the transaction can trigger taxes and fees:

transfer taxes and registration fees (for sales)
capital gains tax / withholding schemes (depending on transaction type)
documentary stamp taxes
association dues (condos/subdivisions)
real property tax
estate taxes and settlement costs
potential donor’s tax issues if transfers are treated as gifts

A good agreement assigns who pays what and how reimbursements work.

12) Red flags that can sink enforceability

Avoid clauses that suggest evasion, such as:

“Filipino partner holds the land in trust for the foreigner”
“Foreigner is the real owner; Filipino is a nominee”
irrevocable powers of attorney designed to mimic ownership control
automatic transfer of land title to the foreigner (generally impossible)
penalties that are unconscionable or contrary to public policy

Even if both partners sign willingly, courts may disregard provisions that conflict with constitutional policy or family law policy.

13) Suggested outline of a Philippines-ready cohabitation agreement

Below is a practical clause map (not a template):

Parties and relationship statement (avoid calling it a marriage if not)
Purpose (clarify it’s about expenses, property classification, dispute prevention)
Definitions (separate vs joint property; contributions; separation date)
Disclosure (each party lists assets, debts, income sources)
Household expenses (who pays what, joint account rules)
Acquisitions plan
- if condo: purchase, title, shares, dues
- if lease: lease terms, renewals
- improvements: approvals, budgeting, ownership treatment
Loans and reimbursements (promissory note integration, accounting method)
Personal property schedule (attach list)
Separation protocol (possession, buyout, sale, timelines)
Death protocol (acknowledge agreement isn’t a will; note debts/loans)
Dispute resolution (mediation, venue, interim relief)
Governing law (Philippines) and severability
Notarization, witnesses, attachments (receipts, schedules, promissory notes)

14) Practical checklist for foreigners before putting money into “property”

Identify whether the target is landed property or condominium.
Decide the lawful structure: condo purchase, lease, or another compliant route.
Document contributions with bank transfers and receipts.
Classify each payment: loan vs rent vs expense share vs gift.
Notarize key documents; register/annotate when appropriate.
Plan for breakup and death—these are the moments documents matter.
Avoid nominee/trust language that looks like circumvention.
Get a local lawyer to align the agreement with:
- your exact relationship status
- the specific property type and title status
- tax and registration realities in the property’s location

15) Bottom line

A cohabitation agreement in the Philippines is most effective when it does three things:

Clarifies money (what each payment is and how it’s repaid or credited)
Builds around lawful property rights (especially given foreign land restrictions)
Creates an exit plan (separation/death processes, valuation, possession, sale)

If you tell me your scenario (condo vs house-and-lot, married vs not, who will be on title, and who is funding what), I can lay out a risk-ranked set of structures and an agreement outline tailored to that fact pattern—still in general educational terms.