Owning House with Brother

pollyanna24

I have read a few threads on here about the pitfalls of owning a house with someone you're not married to and things going wrong, but just wondered if there were any downsides to my situation.

My brother bought my ex out of my house about 2 1/2 years. That was all relatively simple. Had the deeds and transfer of equity all done by a firm of solicitors and my ex received a lump sum.

But if me and my brother fall out, are there any pitfalls? I'm hoping we don't fall out of course, and we seem to have got along for the last 2 1/2 years living together, but if we argue over one of us getting a partner and trying to move them in and such, would the answer be just to sell up and split the proceeds (which is what I envisage happening anyway at some point down the line)?

We are joint tenants, so if something happens to either one of us, the other one gets the house, is that right? I think this is fair enough, but is there any provision I can make for my two young children, or is there just something I should be doing separately from any equity in the house?

Upsidedown_Bear

You might find this useful to read.

http://www.landregistry.gov.uk/public/guides/public-guide-18

ETA
You need a Deed Of Trust drawing up.

http://www.findlaw.co.uk/law/property/buying_property/500297.html

365days

I bought with my brother and it went wrong.

One day I came back from work and he had just gone.....long story......

Was the deposit split 50/50?

In my situation I hadn't paid any of the deposit but earned more than him. I was, with help from other family, to pay him his deposit back and take over the mortgage.

It was a horrible time, and I remember not wanting to take into consideration future selling costs. I told him we could put it on the market, pay all the costs and I'd buy it back......he then saw that half of future selling costs had to be taken off his 'cut'

For the record 15 years on we are ok!

We fell out over him moving his new partner in.

pollyanna24

Thank you very much for your quick replies.

My brother gave my ex half of the equity that was in the house at the time, therefore the other half of the equity was mine.

Since he moved in, we have been paying the exact same amount into the account where the mortgage comes out of, so that there is no arguments as to who owns more than the other (we'll forget about the fact that I actually "get" more use out of the house than him as I have a bedroom and my girls have a bedroom:)).

Hadn't thought about the possibility of his "disappearing" one day, but I suppose the same thing could happen between a married couple, i.e. there's no way to safeguard against it.

Just wondered if there was anything we could do to make it "safer" for the other. At the moment, we are getting on and trusting each other, but who's knows what might happen.

Upsidedown_Bear

pollyanna24 wrote: »

Thank you very much for your quick replies.

My brother gave my ex half of the equity that was in the house at the time, therefore the other half of the equity was mine.

Since he moved in, we have been paying the exact same amount into the account where the mortgage comes out of, so that there is no arguments as to who owns more than the other (we'll forget about the fact that I actually "get" more use out of the house than him as I have a bedroom and my girls have a bedroom:)).

Hadn't thought about the possibility of his "disappearing" one day, but I suppose the same thing could happen between a married couple, i.e. there's no way to safeguard against it.

Just wondered if there was anything we could do to make it "safer" for the other. At the moment, we are getting on and trusting each other, but who's knows what might happen.

Yes - you need a Deed of Trust drawing up.

http://www.findlaw.co.uk/law/property/buying_property/500297.html

Kynthia

What kind of discussions did you have before he bought in? These should have been used to form a deed of trust or cohabitation agreement. Generally you have mostly the same pitfalls as buying with an unmarried partner, but that doesn't mean you both can't protect against some of them. Read this:
http://england.shelter.org.uk/get_advice/families_and_relationships/living_with_a_partner_or_spouse

Additional pitfalls you might face are what happens if one of you meets someone? Would you be happy if your brother moved in a girlfriend? Would he be happy living there while you played happy families with a new beau? If he married, would his wife be happy with you getting his share of the property if he died? Can either of you afford to buy out the other or would he be prevented from ever getting his own family home? You should discuss some of this now so you have an idea of what you both think is acceptable and maybe even formulate an exit plan for you both to stick to should it come to that. It will reduce the risk of it getting nasty.

Yorkie1

If all is going well now, and you haven't yet had these discussions, perhaps now is a good time to have them - before any of the issues arise?

pollyanna24

Thanks for all the replies.

I've mentioned it my bro and now he thinks something's wrong! Haha.

He says he if he gets a gf, then she wouldn't live here fulltime as she probably will have her own house and wouldn't want to live with my kids, but... You never know what can happen.

He's asked me to look into the whole deed of trust as I work for a lawyer, bit of a no brainier really.

Don't think either of us could afford to buy the other out now as we've been ploughing money into the mortgage since he moved in and there is about £100k equity in the property.

pollyanna24

Just one more question. If either of us gets married, for example, as we are joint tenants, the new wife/husband wouldn't be able to get anything or is that something that can be fought against? Seeing we are the ones that have paid so much into the property?

pinkshoes

pollyanna24 wrote: »

Just one more question. If either of us gets married, for example, as we are joint tenants, the new wife/husband wouldn't be able to get anything or is that something that can be fought against? Seeing we are the ones that have paid so much into the property?

The new husband\wife could stake a claim against the 50% share of their partner should they split, as it would be a marital asset.

You need to agree what happens should one of you get a parter and it gets serious enough that you want to live together. Always best to agree this in advance! Often best to rent the property out (and have it as a family business!!) Or one of you lives in it and pays 'rent'.

Savvy_Sue

We (DH and I) bought a house with a friend some years ago, and all lived there very happily with our boys. We did have the 'what if X gets a girlfriend?' discussion at an early stage, but I'd already worked out that X would only get serious with the kind of girlfriend who could cope with his unorthodox domestic arrangements.

Obviously that might not apply to the OP and his brother, but it's worth noting that not everyone will mind this kind of arrangement.