Joint mortgage - deed of trust advice please

getmore4less

Sammy85 wrote: »

I understand what you're saying, but Im happy with the arrangement we have.

It would take me years to pay my half back to him in installments, so instead he gets it back if we sell the house. If i had taken a loan from a bank for the deposit i wouldnt then turn around and say, "im sorry the house is worth less now so im only giving you X amount back." (not that i would take a bank loan out for it, but YKWIM)

For small deposits this makes little difference gut for larger ones you are exposed to a short fall on sale(but do get a extra if prices rise)

eg £100k purchase(inc costs), 20% deposit, £80k sale(after costs)

protected deposit
net £60k for an £80k mortgage so -£10k each. you pay £10k he ends up with £10k

The fairer way to do this is for you to take on more of the mortgage so you support 50% each of the total cost(you don't need a different loan) rather than have a 0% loan from the OH

Equity deposit, mortgage 50:50
He owns 60% you own 40%
you net £32k but owe £40k so pay up £8k
He nets £48k so gets £8k back

karma_pyjama

Thanks for all the responses. We'll go through them and pick the one that's right for us. I think it's important to have a system that works for both gain and loss.