View Full Version : Buying a House / Mortgage-Legal question
Since we seem to know everything on this forum I thought I'd ask on here :)
I'm thinking of buying a house with my gf. I know (though stand to be corrected) that you can buy a house with someone else but it will only be 50-50. so you cannot say own the 30% and the other person the other 70%.
Is there though a way of legally putting this in place? So if lets say you come to sell later you are given the 30% etc?
Dappa D
17-02-09, 11:45 AM
Since we seem to know everything on this forum I thought I'd ask on here :)
I'm thinking of buying a house with my gf. I know (though stand to be corrected) that you can buy a house with someone else but it will only be 50-50. so you cannot say own the 30% and the other person the other 70%.
Is there though a way of legally putting this in place? So if lets say you come to sell later you are given the 30% etc?
perhaps a "deed of trust"....have a google....sure someone a bit more clued up on the subject may know more tho...
454697819
17-02-09, 11:51 AM
there is a way of doing it but I dont know how, afterall, the mortgage company has charge over thier debt before anyone else and other contracts can cause issues with lenders.
yeap agree that could complicate things with lenders. at the end of the day they just wanna see a deposit and don't care where it came from assuming is not money laundry.
I'm looking at the scenario where we break up and I've put 10% she has put 5% and if sold we still get 50-50
Dappa D
17-02-09, 11:57 AM
Deed of Trust
If there's one document that you should absolutely positively have when co-buying it's a Deed of Trust (also known as a Trust Deed or a Declaration of Trust). This can be a simple document drawn up between co-buyers and their solicitor(s), costing no more than a couple of hundred pounds, or it can be as costly and complex as you wish it to be. This is the document that is created between you and signed at Exchange of contracts when buying a property that sets out each of your legal rights over the property (what percentage of its value you each own), how the major costs of ownership are to be split and how the co-buyer relationship will end.
Knowing what percentage of the property's value you own and having this protected in law is important. There is no rule that says two people who decide to buy together have to contribute an even amount to the purchase or upkeep of the home. If you contribute 75% of the money and your co-buyer pays the other 25% who records this fact so when you sell you are guaranteed to get the correct percentage back? Not the mortgage lender, as they only note that you both own the property jointly. Not the Land Registry, as they are just interested in your names to register total ownership. It's actually up to you to do this, and the Deed of Trust states the exact percentage of value of the property that you both legally own.
The major costs of ownership can be anything from the percentage of the total mortgage you are each responsible for paying to repair bills on the property or periodic maintenance. Running a property is a costly business, and if you find a year down the track that you need a new roof who will pay for it? Will things be split 50/50 because you both live in the property and gain the benefit from it, or will it be split 75/25 like the ownership? There is no right or wrong answer here, only negotiation with one another to decide right from the beginning how you are going to handle situations like this so that you are both comfortable with them.
Co-buyer relationships have a natural time limit. To stereotype a typical co-buyer, he or she would be in their 20's and 30's, in their first or second jobs and single (of course there are many people out there looking for a co-buyer through SharedSpaces who do not fit this mould, but I'm generalising here). After a few years have gone by it is natural to assume that many co-buyers will either find that their salaries will have gone up to a level where they can now afford their first solo property or they may have started to think seriously of settling down with their partner. Many people considering co-buying set a legal time limit on the relationship by including it in the Deed of Trust. It could be any number of years you decide upon between you, but having a finite end to the relationship once again means that you are planning your relationship rather than winging it and dealing with the surprises as they occur.
One of the most important factors in drawing up a Deed of Trust is in the thought process that goes into it's creation. If you have been lucky enough to find a decent solicitor (http://www.sharedspaces.co.uk/contact-kaltons) they will take the time to make you consider every important aspect of your relationship with your co-buyer partner, including what happens when you decide to sell. This will once again tune you into one another's thoughts so you are as sure as you can be that you are following the same path and have the same aspirations and dreams for the property you are considering buying together.
HTH
excellent thanks!!
and this would hold up in court?
Dappa D
17-02-09, 12:28 PM
yes mate as long as its drawn up by a solicitor.....Ed?.....
I know :) Where is Ed when you need him LOL
Mr Speirs
17-02-09, 01:05 PM
Probably working :)
Probably working :)
cheeky git :smt019
That confident of the relationship lasting then????? ;)
That confident of the relationship lasting then????? ;)
I'm very confident it will - thank you for pointing it out...:confused:
At the same time we are humans and things happen in our lives for which I prefer to be prepared than unpleasantly suprised!!
I wish my wife contributed to the mortgage :smt086
:D
I know :) Where is Ed when you need him LOL
...on the M6.
You need:
1. to hold the property as tenants in common
2. in box 11 on Land Registry form TR1 tick the third option ansd state 'as tenants in common under the terms of a Deed of Trust dated today's date'
3. Enter a Deed of Trust to set out who owns what. You can spilt it by % shares, or by £, or both, whatever you want. I always advise clients to consider who pays the mortgage (as between you and lender it will be both of you jointly and severally, but who in practice pays), and who pays sale costs. Also consider who bears losses if you sell at less than you pay. You might also consider what triggers sale.
Email me if you need anything else - ed[at]galegal.co.uk (ed@galegal.co.uk)
Ed
EDIT - 'Would it stand up in Court?' - most definitely yes, unless there was some sort of vitiating factor - eg duress.
pencil shavings
17-02-09, 03:22 PM
It can be done, has been done by my mom and a friend of the family for her last 2 homes, no issues at all.
But i think issues might arise if you and your gf dont remain amicable??
It can be done, has been done by my mom and a friend of the family for her last 2 homes, no issues at all.
But i think issues might arise if you and your gf dont remain amicable??
Whole idea is that it survives relationship breakdown...
Ah excellent!! Many thanks Ed...if we do go ahead with something you will be getting a call ;)
pencil shavings
17-02-09, 04:08 PM
Whole idea is that it survives relationship breakdown...
yeah... :smt115
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