Buying a property jointly

gelato_cat

Hi all

My boyfriend and I are planning to buy a house together. I'm a FTB, he has a flat to sell.

We think that we will be able to get a decent amount for the flat and the first viewing is taking place as I type (bf only signed the estate agent contract on Monday, so we're pleased about this). Once the flat is sold, bf will have twice as much cash as me to put down.

We are therefore going to own the new house in the ratio 2:1 - but...

1. How do we arrange this? Is there something we have to draw up with a solicitor as well as with the mortgage company? I know we can be joint tenants or tenants in common but am not sure how we formalise this.
2. If anything did happen and we split up, what would need to happen re the house if one of us wanted to stay in it (ie how would you calculate how much one person owed the other) - given that the value of the house will change over time? If it helps, we plan to get a smallish mortgage (about £100-£150k) and pay it off in the next 10 years.
3. If we get married somewhere down the line, does any agreement we make now still stand, or does it get cancelled out and we own the place 50:50?

I know it might sound a bit strange to split the ownership this way if we are in a relationship (one of our friends has commented on it), but it feels fair in a way if he's bringing twice the amount of cash - but on the other hand unfair as I don't have any way of matching it to bring my share up. Also, as he earns twice what I do (convenient as it makes for easy sums!) we will be paying for all household expenses (including the mortgage) in the ratio 2:1 as well as it didn't seem fair for us to pay equal amounts given I make so much less than he does.

In terms of the relationship, we both view it as a long-term one and wouldn't enter into such a big commitment if we weren't planning to be together for a long time. I am purely wondering what my position will be if the worst did happen.

thanks!

Suze

liz-paul

I'm sure you can own the house in a ratio of 2:1 'officially' but I don't know how you do it. Your solicitor should know though I would think.....

One thing to bear in mind is having kids. In my opinion you don't want to end up looking after any potential kids on your own (assuming you split up & you kept the kids as is most common) & only being entitled to a third of the equity in the house. You may need to look at changing the deal later on. And yes you are quite right to do this even if you are happy & committed now; most unhappy couples started off happy!

gelato_cat

Thanks for the answer - I hadn't mentioned kids as we don't want any I see what you're saying though.

Suze

CLAPTON

You can own a property in two ways.
As 'joint tenants' .. means you both own the whole property.. so if one dies then the other automatically owns the whole property

or

As 'tenants in common' and own the property in any proportion, so yes you could do a 2:1 split if you wanted to.
In this case if one of you dies, their share will become part of their estate and will not automatically become the survivors and may force the survivor to sell and move out.

Marriage won't change the legal ownership situation except you will automatically become his next of kin. On death the property will be subject to probate rather than automatically become the survivors.

It does indeed seem unromantic and a bit selfish to me but thats between you two.

david29dpo

You will also need a trust deed to state the percentage of ownership. A simple witnessed document.

localhero

....Also if you own the property as tenants in common, you will both need to make a Will to determine who should receive the share should either of you die.