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Co-habitation - advice please!
Fi_NI
Posts: 1 Newbie
Hi,
I am a homeowner (apartment) and have asked my boyfriend to move in with me.
We plan to buy a home together in a few years time but for now are looking for some advice on co-habitation.
I purchased my apartment 3yrs ago through a co-ownership scheme (i own 50%, the government owns the rest) and have been paying an interest-only fixed mortage up until now. I have recently converted to variable repayments and my plan is to begin full repayments. I bought at the peak of the property boom and i am now in negative equity.
My boyfirend does not own any property.
I have been trawling the internet looking for advice on how best to protect both my boyfreind and myself. My main questions are as follows:
(1) We are open to sharing the mortgage and putting his name on the deeds. However, would it be better to keep his name effectively "clean" and therefore he would be considered as a first-time buyer when we buy our next home?
(2) If we arrange for his name to be placed on the deeds, how can we acknowledge the 3yrs of payments i have put down?
(3) If my boyfriend moves in and contributes to the mortgage (and other household bills), rather than formally takes on 50% of the mortgage & placing his name on the deeds, how can he be protected? Ive heard of cohabitation agreements but are these legally binding?
We are a young couple, excited at the prospect of moving in together. However, we realise we need to take off our rose-tinted glasses and practically address the financial issues and legal impliactions if it doesn't work out.
Any comments on the above or general advice would be most welcome
I should also mention i live in Northern Ireland, in case the law is different.
I am a homeowner (apartment) and have asked my boyfriend to move in with me.
We plan to buy a home together in a few years time but for now are looking for some advice on co-habitation.
I purchased my apartment 3yrs ago through a co-ownership scheme (i own 50%, the government owns the rest) and have been paying an interest-only fixed mortage up until now. I have recently converted to variable repayments and my plan is to begin full repayments. I bought at the peak of the property boom and i am now in negative equity.
My boyfirend does not own any property.
I have been trawling the internet looking for advice on how best to protect both my boyfreind and myself. My main questions are as follows:
(1) We are open to sharing the mortgage and putting his name on the deeds. However, would it be better to keep his name effectively "clean" and therefore he would be considered as a first-time buyer when we buy our next home?
(2) If we arrange for his name to be placed on the deeds, how can we acknowledge the 3yrs of payments i have put down?
(3) If my boyfriend moves in and contributes to the mortgage (and other household bills), rather than formally takes on 50% of the mortgage & placing his name on the deeds, how can he be protected? Ive heard of cohabitation agreements but are these legally binding?
We are a young couple, excited at the prospect of moving in together. However, we realise we need to take off our rose-tinted glasses and practically address the financial issues and legal impliactions if it doesn't work out.
Any comments on the above or general advice would be most welcome
I should also mention i live in Northern Ireland, in case the law is different.
0
Comments
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hi,
normally these agreements are to protect the initial owner's additional equity, but since you are in negative equity and have only been paying interest only and no capital repayments - this agreement should be about protecting the additional owner from the negative balance that you bring to the table.
I'm not even sure you ARE property owners, sounds like the bank owns it and you rent it? What is the POINT in adding the second person? I suggest keeping them well clear of it to enable you to flee to another property and go personally bankrupt if (when) property continues to fall in price.
I wish you well, it's a horrible situation you have there, good luck0 -
Re. the mortgage what did the mortgage offer say about having someone else in both
a) As 2nd person in property
b) as 2nd person on mortgage??
Re. the apartment what do the deeds say about having over people living there & about getting additional names on't deeds??
Might help to answer you questions!0 -
househunting wrote: »I suggest keeping them well clear of it to enable you to flee to another property and go personally bankrupt if (when) property continues to fall in price.
Come again?0 -
Interest only on shared ownership apartment........:eek:
What were you thinking?
0 -
you own 50% of nothing.... you have interest only and shared ownership then we have negative equity and you call yourself a homeowner....you need to sit down and sort this lot out as it looks like you have not noticed a few things about homeownership.. keep him out of it all just in case you need to bail out at least he will be able to get a mortgage...it will be a few years before you will be out of negative equity,a good few...It is nice to see the value of your house going up'' Why ?
Unless you are planning to sell up and not live anywhere, I can;t see the advantage.
If you are planning to upsize the new house will cost more.
If you are planning to downsize your new house will cost more than it should
If you are trying to buy your first house its almost impossible.0 -
Hi,
I am a homeowner (apartment) and have asked my boyfriend to move in with me.
(2) If we arrange for his name to be placed on the deeds, how can we acknowledge the 3yrs of payments i have put down?
Sorry to hear about your situation. Not at all good.
What acknowledgement are you looking for, regarding the 3 years of payments? With IO you are only paying the interest on the loan to buy the property. Until the full amount is paid and you get the deeds, the mortgage holder is the "homeowner".
Having chosen IO, what repayment mechanism do you have in place to pay back the 1/2 share you have? If you were counting on rising property values to be able to pay off the loan, then unfortunately this isn't going to happen for a very long time.
Personally, for both your sakes and for a variety of reasons, I'd keep the BF off the deeds.
Good luck.0 -
You have nothing to protect.
As your loan is Interest Only you have been paying this to the lender.......
Just the same as paying rent to a landlord in that some will call it dead money.
As a renter though you can usually extract yourself with little financial upheaval. Sadly this won't be the case here.
Keep the boyfriend well out of it. If you do need to take the worst case scenario then he will need a clean credit record.0 -
Yep, looks like you don't fully understand what paying interest only means. Except for any deposit you may have put down, you don't own even a brick of the property (I assume no deposit, or that it's been wiped out, since you're in NE).
I'd think about moving to a proper repayment mortgage and charge the boyfriend rent. Things can get messy if you split up each owning bits of the property.0 -
Fiddlestick wrote: »Come again?
House prices are currently falling accross the UK and are expecting to continue falling for at least the near future, possibly indefinately.
This is especially so in Northern Ireland where they are falling faster than anywhere else in the UK. This is because of the massive falls just over the border in the Republic or Irelend, where house prices have fallen more than 50%.
The OP wold be wise to keep her BF off the mortgage to keep his credit history clean.Bankruptcy isn't the worst that can happen to you. The worst that can happen is your forced to live the rest of your life in abject poverty trying to repay the debts.0 -
This is especially so in Northern Ireland where they are falling faster than anywhere else in the UK. This is because of the massive falls just over the border in the Republic or Irelend, where house prices have fallen more than 50%.
House prices in NI aren't falling solely because of the crash in the RoI. They are crashing faster because they rose faster and it was a completely unsustainable situation.0
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