Moving in with BF

brokenlily

Hi,

Me and BF are planning to move in together next Autumn, after I finish my MA course.

My Mum is buying a house, and we will both live in it and the rent we pay will go to pay the mortgage. My Mum has said that once we have paid as much towards the mortgage as she puts down in deposit, she will sign the house over to us. She has offered to take on the mortgage because she can get a better mortgage than we would especially as I do short term contract work.

The one pitfall that I am worried about is, what if BF and I split up before the point where the house could become ours? What will his rights be, if he has been paying towards this mortgage? Technically if neither of us own the house and are tenants, then he wouldn't necessarily have a claim on it at all, and my Mum says that she would want me to be able to stay there if that happened. Should she therefore put a tenancy agreement together so that the two of us are effectively tenants?

brians_daughter

brokenlily wrote: »

Hi,

Me and BF are planning to move in together next Autumn, after I finish my MA course.

My Mum is buying a house, and we will both live in it and the rent we pay will go to pay the mortgage. My Mum has said that once we have paid as much towards the mortgage as she puts down in deposit, she will sign the house over to us. She has offered to take on the mortgage because she can get a better mortgage than we would especially as I do short term contract work.

The one pitfall that I am worried about is, what if BF and I split up before the point where the house could become ours? What will his rights be, if he has been paying towards this mortgage? Technically if neither of us own the house and are tenants, then he wouldn't necessarily have a claim on it at all, and my Mum says that she would want me to be able to stay there if that happened. Should she therefore put a tenancy agreement together so that the two of us are effectively tenants?

He wouldnt have a claim at all as you both would own half of nothing it will be your mothers house, you will simply be payimg rent

TBH if it was my daughter i would be putting the agreement in her name. Then if the worst happened and they split he has no right to remain in the property as a tennant.

You need a tenancy agreement and your mother will need to declare this income, even if there is none to HMRC. Even though theres no monies being made in reality, there is on paper as you are effectively paying your mothers mortgage for her (all be it it will eventually become your house). Please ensure this is done as the more ppl you tell the situ to the more change someone reports your mother for tax evasion on undeclared earnings.

Mallotum_X

Dont get mum to commit to anything in writing or otherwise now. Have a normal tenancy agreement and pay rent as agreed.

If in the future mum wants to sign it over then that can be a seperate issue.

Dont forget as you are paying rent, not repaying a loan the money you pay mum will be taxable (or rather the profit will be - after any interest, repairs etc).

brokenlily

yes she knows it would be taxable, she has an accountant who would sort all that out for her.

I have already said to her she should have a proper tenancy agreement, but if that was the case and my BF and I were tenants, say the agreement was in both our names, then what would happen then if we split? Would my BF have right to remain until the end of the tenancy?

BitterAndTwisted

Yes, if the tenancy was in both of your names then the b/f would have the right to live there even if your relationship failed before the tenancy ended. There are alternatives: you could take out the tenancy and your b/f acknowledged on the agreement as a permitted occupier. In the first instance your mother could issue you with a joint-tenancy for six months and renew it on a six-monthly basis.

While there is an outstanding mortgage on the property it can't be signed over to anyone as your mother will not fully own it so she couldn't divest herself of it other than by selling it and settling the mortgage.

Once the mortgage is paid I would advise your mother in the strongest terms possible to not sign the property over to the two of you until and unless you are married.

brokenlily

BitterandTwisted - thanks, I will perhaps put to her that the tenancy is renewed regularly, at least at the start of things.

BF and I have been together for 2 years and have waited a decent amount of time before moving in together, we didn't want to rush it as both of us have rushed into living with partners before and made a mistake in doing so. However, we don't want to get married. Our parents are both divorced (rather bitterly at that) so neither of us are marriage fans, or under any illusion that marriage guarantees a lasting relationship, so if we had to wait until we were married to have the house as ours, we'd be waiting a long time!

My mum is concerned with ensuring not just that there is protection there for me and her, but also that things are not completely unfair to BF. Perhaps having an ongoing renewable tenancy agreement as you suggest would be the fairest way, and then BF would have some time at least to sort out somewhere to live if we did split up.

Acc72

I agree with having a formal agreement in place.

However, being pedantic ..... as the property will be mortgaged, it is likely that your mother will need a specific mortgage product rather than a "regular / normal" mortgage.

BitterAndTwisted

A third option might be for your mother to sell the property to you only rather the two of you in the future, if both she and you wanted to ensure that you're not disadvantaged by a relationship break-up at some point in the future. You could always have a rethink about sharing the property with him formally once you're both drawing your penions.

BitterAndTwisted

Acc72 wrote: »

I agree with having a formal agreement in place.

However, being pedantic ..... as the property will be mortgaged, it is likely that your mother will need a specific mortgage product rather than a "regular / normal" mortgage.

Yep. Mother will need to acquire a Buy-To-Let mortgage rather than a residential one and the rates are higher.