Buying with my partner: Partnership Agreement?

House_Buyer_2011

Hi All,

I'm buying a house with my partner. I am putting significantly more into the deposit than he is - I'm obviously happy to do this, but we want to have an agreement that states that if we break up and have to sell the property that I will get out my deposit and the proportion of the mortgage I've paid (and he will get the more of the proportion of the mortgage as he is paying more). Any profit will be split according to the % of the mortgage we are paying.

However - as you can imagine - money is tight, so we'd like to get something drawn up and give a copy to both sets of parents which outlines our wishes.

Does anyone know where I can get such a format?

BitterAndTwisted

Wht you're after is I believe called a "Deed of Trust" which a soliitor will draw up for you. You can decide whether unequal deposits are returned should the relationship fail or they have bought a percentage of the property. This is obviously something that you discuss together beforehand.

House_Buyer_2011

Great - is there any way of getting this format and writing it ourselves rather than incurring the costs of a solicitor?

BitterAndTwisted

This is most probably the most expensive purchase you will ever make in your life! Why would you want to risk jeopardising that for the sake of a couple of hundred quid or less?

Jebrelli

B&T is correct - you will need a Deed of Trust to be drawn up. I'm in a similar situation to you, so my partner and I are having this created for us through the solicitor as part of buying our flat.

Our solicitor has quoted £90 for the deed. This will also need to be filed with Land Registry as you'll be tenants in common with unequal shares.

For something so important I think I'd rather pay a solicitor and know the documentation has been done correctly.

sonastin

My OH was reading extracts from a boilerplate deed of trust to me last night, that he bought when he was with his ex (never got round to filling it in but they came to an amicable agreement over the split so no problems). I don't know where he got it but it was only really good for a very straightforward division of the property e.g. splitting on fixed %. Your situation sounds a little bit more complicated as the proportion you each get will change over time, if he is putting in more mortgage than you?

Also, you need to address how you'll deal with it if the house is worth less when you come to sell - will you still be entitled to the cash sum you put in and if so, how will you then deal with the deby if you are in negative equity? etc. I think you'll need a solicitor's help to draft something that covers all eventualities in your situation.

Richard_Webster

You are not likely to find any standard set of clauses to deal with the situation that you want. You need a deed of trust that sets your proportions related to the actual amounts in lump sums and mortgage payments that each of you have put in. You should record this and both sign a note of the up to date cumulative figures every 2-3 months to minimise any future arguments.

As others have said you need to think through all the possible outcomes in terms of property values in the future etc.

As a lawyer I have to advise people on the basis that they could get taken to the cleaners by others so they should protect themselves, but as a private individual I have to ask what you are doing buying a house together if you are not sufficiently committed to each other for the money issue still to be a potential issue.

DermotFlanigan

It's not really a case of commitment. You can never tell what the future holds. I would want exactly the same thing if I was in OPs situtation.

BitterAndTwisted

Eh, but if they were truly committed to each other and the relationship they would be married or in one of those new-fangled civil partnerships where such issues are an irrelevance.

stokesley

Agreed, B&T.

World's gone mad. Harumph.

BitterAndTwisted

Not totally mad but it seems to me that some folk jump into buying property together, possibly because they think it's cheaper in the long-run than that alleged "dead money" spent on rent, when the likelihood is that the mortgage-term will most probably be for several times longer than the relationship lasts.

In these inflationary times when property prices are falling and interest-rates about to go up, there's not a huge likelihood of anyone making a penny, and very possibly losing quite a lot, if they split and have to sell up within five years. It's definitely not something I'd be doing lightly.