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Can signing a roommate agreement protect your finances if things go sour?

Roommates renting a home.

When Evan Dickson discovered his roommate had pocketed several months' worth of rent instead of paying it to their landlord, he sat him down for a stern chat.

"We were getting really anxious that he was just going to ditch us and stick us with the bill," says the 33-year-old Toronto resident, who was living with three other guys in a four-bedroom home at the time.

But despite Dickson's efforts, his friend and roommate did just that: he took off without warning to go on tour with a band and wound up in British Columbia.

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Seven years later, Dickson doesn't harbour any ill feelings. He knew his friend was going through severe emotional stress at the time and, fortunately, his roommate's parents eventually footed the bill for the outstanding rent.

But Dickson also learned a hard lesson: bunking with roommates can save piles of cash on rent and utilities, but it can also expose you financially if one of the roomies suddenly bails, leaving you on the hook to cover all the expenses.

Geordie Dent of the Federation of Metro Tenants' Associations urges caution before getting entangled in a rental agreement with another person.

In the majority of cases, everyone who has signed the lease is equally responsible for the entire sum of the rent, not just their portion, says Dent.

That means if one tenant skips town and stops paying, the landlord is legally entitled to go after any of the other tenants — even if they have been upholding their end of the bargain.

"In a scenario where you have five people on a lease, this could be really messy," says Dent.

Tom Durning, a staff member at the Tenant Resource and Advisory Centre in Vancouver, says that's why it's important to be very selective about who you live with.

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"Don't sign a lease for a year with somebody you hardly know," says Durning.

But, he adds, it's equally important to be skeptical of your friends because "you never really know a person until you live with them."

Durning recommends asking the landlord to make you "tenants in common" rather than co-tenants. That means each person pays a separate rent to the landlord and is only responsible for his or her share, rather than both tenants being "jointly and severally" liable for the entire amount.

Of course, not all landlords will agree to such an arrangement.

"It doesn't happen very often, but I've heard of smart tenants insisting on doing that," Durning said.

In situations like Dickson's, where only one roommate is on the lease and the others pay their portion to this "head tenant," it's important to have a formal, written contract outlining the rules.

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However, Dent says most people don't realize how much effort it can take to enforce such a contract.

"No one's going to come and hold a gun to somebody's head and make them write you a cheque," Dent said.

Enforcing the contract requires going to small claims court, which may cost a fee. And even if the judge rules in your favour, you will often have to get an enforcement order to be able to garnish money from someone's bank account.

Dent says it's vital to write all of the details you can think of into the contract. Because roommate-to-roommate relationships fall outside the scope of the Residential Tenancies Act, none of the usual rules — such as the required 60 days' notice prior to moving out — apply, unless stipulated in writing.

"If it's not written in there, it can be very difficult to prove in small claims court," Dent said.

But while all of this may sound scary, Dickson says he hasn't been deterred from living with roommates — he's just more careful.

"I have lived with roommates pretty much my entire life," says Dickson. "I think that living with people is awesome ... I've always enjoyed having other people around."

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