Buying house together - but unequal deposit

biblejohn

Dora_the_Explorer wrote:

Why would you want to split things between you if you're getting married?

If it comes to differences between what each of you contribute will you be splitting the cooking, cleaning and housework 50/50? Will you keep a tally of how much time you each contribute to the household? How will you cost that?

Please forgive me if I've misunderstood, but what you are describing reads like a business relationship involving property, rather than a loving relationship involving making a home together.

What about doing the DIY, gardening, washing the car and all the "manly" tasks the guy might typically do? Of course, living together is a joint thing and most people share stuff around the house such as cooking, washing the car, cutting the lawns, cleaning or whatever. But, if both parties are investing a large amount of money into the property most people would want to make sure that there money is safe.

I advised a girl at work last year to draw up an agreement as she was in a very vunerable situation. She had a property worth 300k with around 200k in equity in it. She had just met a guy who had just come out of prison who was declaring his undying love for her. He didnt have a penny to his name. She disregarded my advice and within 4 months had married this guy who moved into her house. He had no credit rating, so got her to take out loans in her name to the sum of 30k. Now they are having problems as he is becoming violent and is no longer the nice sweet romantic person he was when she met him.

So, it goes to show that 1 minute things can be all loved up, rosey, happy as larry, but you never know whats around the corner!

november

Hero. I understand why you are asking as well. In fact I think going in with 'eyes open' is better than going in without thinking about it. At least it shows you have discussed finances etc and reached agreement before getting married.

Biblejohn (and others)

I had been told that once you marry everything you own becomes 1/2 your spouse's in the UK. Also that although you can draw up pre-nups etc they are not legally binding in this country.

I asked originally as I own my own house which has doubled in value from my original mortgage (I have equity) and have 2 children. I understand and am happy that my partner has rights based on his contributions. I was told though that on marriage he would automatically 'own' 50% even if the mortgage and house were in my name. In other words that on marriage I am giving him half my equity whether I like it or not. He doesn't even want this but we have been unable to find advice that says otherwise!

I must admit I had given up asking about it due to statements made on previous threads where the assumption was that if I'm asking I shouldn't be marrying.

I raise the issue because I also wondered in Hero's case I know they could buy as tenants in common but when they married would that override that? It doesn't seem to make sense if marriage didn't override 'tenants in common' but did override sole ownership*

*note - I know technically I will be still sole owner but financially it seems marriage changes it to a joint financial benefit while remaining a sole financial liability

heroicnich

Thanks for all the advice I am getting, I really appreciate it. I agree with the sentiment that if you are going into marriage, you should be anticipating it being a lifelong commitment - but I also think that it is important to bear other outcomes in mind. Unfortunately, as a result of my parents' divorce, my mum is now having to consider financial issues that haven't ever previously arisen - like, what is she going to do for a pension? Like so many women in their middle years, she expected to share her retirement with my dad, living off his pension as he had worked during the years when she ran the home and looked after me. So undoubtedly this situation is impacting on me - but I like to think that I am just being sensible anyway.

As I said, I'm putting in more than my OH - and wondered if (for example) tax rules governing the transfer of funds between husbands and wives would make it a better idea to consider starting to address the difference after we get married (with such a stipulation written into any agreement between us). E.g. say I put in £10k and he puts in £5k; if he is in a position to pay me £2.5k (so that we have both put in £7.5k) would it be better to do this when we are married, so that the transfer isn't taxed? I'm a bit hazy on how marriage affects tax, so please let me know if I am stumbling around in the dark!

heroicnich

november wrote:

I had been told that once you marry everything you own becomes 1/2 your spouse's in the UK. Also that although you can draw up pre-nups etc they are not legally binding in this country.

I raise the issue because I also wondered in Hero's case I know they could buy as tenants in common but when they married would that override that? It doesn't seem to make sense if marriage didn't override 'tenants in common' but did override sole ownership*

*note - I know technically I will be still sole owner but financially it seems marriage changes it to a joint financial benefit while remaining a sole financial liability

Hi November,

I know that pre-nups aren't legally binding in the UK, but as I understand it, they can be taken into account by the divorce court. So (as far as I gather - please shout if I'm wrong) I think that the general gist of a pre-nup can guide the court in any settlement.

As for the joint tenants/tenants in common issue - I think that only applies to the deeds i.e. if you buy as tenants in common (this had better be the right way round), that is what is says on your deeds, full stop. You can be married, buy as joint tenants, and then change the deeds to tenants in common e.g. for inheritance tax purposes, or so that (if you are getting divorced - I'm learning about this all the time) you can sell the house and benefit from the sale independently.

I think, from what posters on another thread on this board have said, if you are the sole owner, and pay the mortgage, then the house is yours. If your partner (husband etc) starts to pay the mortgage, or makes changes to the house that add value - e.g. conservatory, new kitchen - that they pay for, then they can claim a portion of the equity, but not necessarily half. And to be honest, if you have children, surely a court would consider the fact that they need a home?

Dora_the_Explorer_5

Pre-nups: if one of the parties was feeling agreived they could argue on divorce that they were forced to sign the pre-nup under duress.
Children do need a home - consider this case history: Man marries woman with two children and but doesn't adopt them, they buy a house together with 50% deposit paid by her from proceeds of her former matrimonial home. Both contribute to the mortgage. Wife dies, husband marries woman with three children which he adopts, second wife divorces him and she is awarded 50% of matrimonial home to which she hasn't contributed a single penny during a very short marriage and buys the other 50% with a mortgage. The children of the first wife, now over 18, are left homeless and with no benefit from their mother's financial contribution to the home, the adopted children can receive a share at some point in the future.

lush_walrus

I think it depends on the nature of both people involved really as to what extent you decide to go to to protect the deposit incase of the future worse senario.

I have a simular situation at the moment, where I have a considerable amount more money at the moment than my BF. But in our case, I am not so worried as (may of course be proven wrong) I am 99.9999999% sure that should all go wrong as we both have a good history of 'pleasent' break ups we will be able to come to an agreement should we go our own ways.

But, if you are worried I would have thought that as a letter can be considered to be a contract, you may be able to word a letter of sorts explaining that the deposit you are providing is in effect a loan (or something to that extent rather than a deposit), stating the amount etc, and that should you both decide to sell the house etc then that loan will become due on completion etc.

biblejohn

heroicnich wrote:

Hi November,

I know that pre-nups aren't legally binding in the UK, but as I understand it, they can be taken into account by the divorce court. So (as far as I gather - please shout if I'm wrong) I think that the general gist of a pre-nup can guide the court in any settlement.

As for the joint tenants/tenants in common issue - I think that only applies to the deeds i.e. if you buy as tenants in common (this had better be the right way round), that is what is says on your deeds, full stop. You can be married, buy as joint tenants, and then change the deeds to tenants in common e.g. for inheritance tax purposes, or so that (if you are getting divorced - I'm learning about this all the time) you can sell the house and benefit from the sale independently.

I think, from what posters on another thread on this board have said, if you are the sole owner, and pay the mortgage, then the house is yours. If your partner (husband etc) starts to pay the mortgage, or makes changes to the house that add value - e.g. conservatory, new kitchen - that they pay for, then they can claim a portion of the equity, but not necessarily half. And to be honest, if you have children, surely a court would consider the fact that they need a home?

Spot on.

Another thing they do consider like in the girl i knows case is how long the couple have been married. If they have only been married a few months then get divorced, the courts are highly unlikely to award the new husband 50% of everything.

Spendless

bear in mind that the length of marriage and/or children coming along will change things re the deposit should you split
you don't have to be married ages before a drastic change may happen. our 1st was born 8.5 months after our wedding :eek:

kellyp

I am buying a house with my other half, and i am putting in 20k deposit whilst my fellar is putting in 10k. WE have asked the solicitor to incorporate into our contract that i have put in x % of total property purhase price, whilst fellar has put in y % of purchase price. In any future sale we recieve x and y % of selling price and all reamining money is split equally.

heroicnich

Spendless wrote:

bear in mind that the length of marriage and/or children coming along will change things re the deposit should you split
you don't have to be married ages before a drastic change may happen. our 1st was born 8.5 months after our wedding :eek:

Point taken! As I said earlier, all our current agreements are based on the fact that we both work full time, earn OK salaries and are relatively independent. I guess that is up for discussion at the moment with marriage on the horizon, but children definitely change a lot of things! I guess the motto is to keep talking about it, and not just 'fall into' an arrangement. I get the impression that applies to marriage and relationships generally!