Boyfriend moving in - property ownership advice

BitterAndTwisted

NO! You cannot accept "rent" or anything else which looks like it from a live-in partner and not risk them making a successful claim on the property, or part of the equity, whether it's held in both names or not.

A partner can never be a lodger. Any money that changes hands between partners, which is not provably a share of CTax, utilities or food, will be seen later as establishing a claim on the property. Partners never charge each other rent!


One only has to read a few threads over on the "House Buying, Selling or Renting" part of the forum to discover what total misery some people let themselves in for when they don't understand this distinction. Or don't want to until it's too late.

burnoutbabe

bodmil wrote: »

What about if he pays half the bills making it very cheap rent for him so he should be happy and you get to keep your mortgage as is. Then he should put X aside in a savings acount for a year. He can then either put that on your mortgage when you're happy, or keep it as a deposit fund for a new house together later in ther future?

I don't know how long you've been together but anyone with zero savings is clearly not thinking about the future however long you've known him.

thats what i did, i didn't charge any rent and boyfriend saved his "rent" into an account towards a future deposit. Seemed simplest all round.

And of course you can charge your partner rent, there is no rule you can't sleep with your lodger? maybe you'd have issues with rent a room claim if they don't have their own separate room but thats a tax thing. if there is a clear legal agreement that you are charging and they are paying rent, they would accept that in the event of a dispute.

Mojisola

BitterAndTwisted wrote: »

NO! You cannot accept "rent" or anything else which looks like it from a live-in partner and not risk them making a successful claim on the property, or part of the equity, whether it's held in both names or not.

A partner can never be a lodger. Any money that changes hands between partners, which is not provably a share of CTax, utilities or food, will be seen later as establishing a claim on the property. Partners never charge each other rent!

burnoutbabe wrote: »

And of course you can charge your partner rent, there is no rule you can't sleep with your lodger? maybe you'd have issues with rent a room claim if they don't have their own separate room but thats a tax thing. if there is a clear legal agreement that you are charging and they are paying rent, they would accept that in the event of a dispute.

Not if you are a couple. If a partner has been paying rent or a contribution towards the mortgage (however you want to phrase it), he/she will have established a claim on the property.

BitterAndTwisted

Burnoutbabe you are wrong. Partners never charge each other rent. A live-in partner can never be a lodger. You might look at this differently but the courts do not. And that's all that matters.

LannieDuck

I can see this from your partner's POV a little. I moved in with my bf (now husband) some years ago. At the time he had a large-ish mortgage on a flat that he was paying off. I had substantial savings, but no mortgage yet. I paid him a small amount of rent and it covered his mortgage (reading the replies on this forum, this might have caused problems had we split up...!).

As time went on, I realised that if we split up he'd have a solid investment, and I'd have nothing. Maybe the OH's bf has realised that he needs to start thinking about his future a bit more, and would like to begin building up an investment. He may even have been inspired by the OP!

Presumably OP wants to live with bf, which wouldn't fit with bf buying his own place to live in and paying off the mortgage, so paying for a share of OP's investment might seem like a sensible solution to him. However, it does very much depend on how likely the relationship is to survive, and I can see why the OP is nervous.

As an alternative, maybe OP could suggest he buys a buy-to-let flat. He could be building up his own investment in his own property, whilst getting sufficient rent to then pay OP rent (or not, if that would affect ownership of the house). A bit convoluted, but protects both parties.

Yorkie1

LannieDuck wrote: »

As an alternative, maybe OP could suggest he buys a buy-to-let flat. He could be building up his own investment in his own property, whilst getting sufficient rent to then pay OP rent (or not, if that would affect ownership of the house). A bit convoluted, but protects both parties.

Nice lateral thinking, but unlikely to be successful.

I believe most BTLs need a minimum of 25% deposit and, often, the applicant to be a home-owner already.

bodmil

LannieDuck wrote: »

I can see this from your partner's POV a little. I moved in with my bf (now husband) some years ago. At the time he had a large-ish mortgage on a flat that he was paying off. I had substantial savings, but no mortgage yet. I paid him a small amount of rent and it covered his mortgage (reading the replies on this forum, this might have caused problems had we split up...!).

As time went on, I realised that if we split up he'd have a solid investment, and I'd have nothing. Maybe the OH's bf has realised that he needs to start thinking about his future a bit more, and would like to begin building up an investment. He may even have been inspired by the OP!

Presumably OP wants to live with bf, which wouldn't fit with bf buying his own place to live in and paying off the mortgage, so paying for a share of OP's investment might seem like a sensible solution to him. However, it does very much depend on how likely the relationship is to survive, and I can see why the OP is nervous.

As an alternative, maybe OP could suggest he buys a buy-to-let flat. He could be building up his own investment in his own property, whilst getting sufficient rent to then pay OP rent (or not, if that would affect ownership of the house). A bit convoluted, but protects both parties.

But if, as in your situation, the mover-iner pays a small amount of 'rent', and nothing to the mortgage, they have the opportunity to put money aside, whilst the owner of the property is paying their mortgage. You might not have a stake in the property, but you have much more money in the bank.

LannieDuck

bodmil wrote: »

But if, as in your situation, the mover-iner pays a small amount of 'rent', and nothing to the mortgage, they have the opportunity to put money aside, whilst the owner of the property is paying their mortgage. You might not have a stake in the property, but you have much more money in the bank.

Yes, except that money in the bank gets miserable returns, and even erodes in value. Property prices generally (although certainly not always) increase over time. Property is an investment, savings are just savings.

(Incidentally, if the mover-iner pays sufficient 'rent' to cover the owner's mortgage payments, then the owner gets their mortgage paid off whilst also being able to set aside money for their own savings. Whilst the mover-iner can put less into their own savings because they're paying 'rent'.)

LannieDuck

Yorkie1 wrote: »

Nice lateral thinking, but unlikely to be successful.

I believe most BTLs need a minimum of 25% deposit and, often, the applicant to be a home-owner already.

Yes, true. I had forgotten that bf doesn't have savings and therefore has insufficient capital to get a mortgage himself. I can see why he wants 'in' on the OP's investment...

Rottensocks

In theory, any sum of money that boyf pays to you and that could be used for paying your mortgage means that boyf could have a claim in future..... So best to get an agreement drawn up with a legal bod beforehand, so that you can both make clear he has no claim.


Alternatively, if you don't mind him having a claim, make sure you have a mortgage statement sent to you & a quick valuation, so that you can agree on the property value and remainder of mortgage from when he moved in.

I would be cautious of simply signing over half of all my hard work, so I do understand where you're coming from. And I KNOW it sounds bloody minded and unromantic to be talking cold hard cash with your future live in beau.... But to be fair, if he gets a strop on talking about future finances, then he's telling you something about himself that you shouldn't ignore!