House Pre Nuptial / Purchase Agreement

dfh4np

Hi,

Can you get such a thing as an agreement to cover a mortgage / property?

I suppose thinking of these matters is a sad sign of the times but I have a duty to protect / advise a family member as they have no experience. I have seen many situations where honest people have been done over and peoples lives can change so quickly.

To explain :

A family member is buying a house Solely in their name as a FTB, They have a partner of 18 mths but they cant get on the mortgage due to previous adverse (Before they met). Both live with parents currently.

My family member is putting down a 10% deposit (£15K) from their own savings and paying all the legal and set up costs etc (£2K). They intend spending up to another £10k modernising and furnishing the house over the next year, which will go on credit cards / loans again solely in their name and paid as costs dictate / share options from their work pay out in the next 2 years.

The partner will not be paying anything towards purchasing the house but will be moving in and paying half the monthly costs.

The partners family reckon that the partner should have an agreement to say they own half the house?, so it got me thinking an agreement would be beneficial as the partner technically has no liabilities and can walk at any time.

The partners family is also quite large and with an extra 2 rooms in the house they might have ideas over time on some musical chairs, which the purchaser would not want, although these things can be cleverly dropped on you.

Whats the rules and whats fair.

Has anyone any experience of these matters and would an agreement offer the purchaser any sort of protection in being screwed over or held to ransom if circumstances change.

The property is in Scotland if that changes anything, I have a nag in my mind that if the purchaser declares the friend as staying there the friend will need to sign a matrimonial homes letter of some kind?, whether that gives them more or less rights I don't know.


Thanks for looking.


dfh4np

poppy10_2

dfh4np wrote: »

The partners family reckon that the partner should have an agreement to say they own half the house?, so it got me thinking an agreement would be beneficial as the partner technically has no liabilities and can walk at any time.

If he is on the mortgage, then he is 100% liable for the mortgage, as is your friend. If they are not on the mortgage, your friend's mortgage company will not allow him to own half the property - what if they ever wanted to repossess? How could they sell half a house? He either has to be on the mortgage or he can't own the house.

If they did get a mortgage together, they could become "tenants in common" - which means instead of them owning the home jointly they each own a set percentage, say 50% each. Being tenants in common could also protect your friends deposit and the other expenses she is paying in. For example, your friend could stipulate that she is entitled to the first £27k of the proceeds if the house is sold, and then any remaining value is split between them.

The situation in Scotland is of course different. I'd recommend they seek advice from a solicitor - this is the biggest financial decision they will ever make, involving tens or hundreds of thousands of pounds, it's worth paying a couple of hundred for a professional to protect your interests