Splitting the bills!

purpleharp

Some really interesting suggestions and advice, thank you all...
I've come up with a few different suggestions and we're going to have a chat about them today/tomorrow.

afly

I think 50/50 on the bills. OP retains full responsibility for the mortgage. OH pay's the equivalent into a savings account.

Repairs, improvements can be negotiated as and when. Here I think it fair they pay half in exchange for their generous rental agreement.

Whilst you're together,

- The partner lives rent free but has no official standing in the property

Should you split apart,

- The partner has nowhere to live but some cash to find somewhere else
- You retain full ownership of the property and all equity in it (there is no recourse as an 'interested party')

Should you stay together,

The combination of the equity in the property and the savings buildup should see you both very comfortably getting another property you can both be happy with investing in together


If you wanted to push it further perhaps the partner fund an annual holiday or dinner's out for you both out of some of the savings

John1993_2

Hooloovoo wrote: »

As an aside ... this is the easy dilemma.

The difficult job comes when you decide to purchase a house together and you have £200k of equity to contribute and he hasn't got a pot to pee in.

I've no clue how to handle that without a pre-nup of some kind.

My other half and I bought a flat together a couple of years back, and had different levels of deposit to put in, with mine being a lot more than hers. What we decided is that we'd split all bills down the middle, and do the same with mortgage payments, and then when we sell, we'll arrange it so that each of us earned the same rate of return on what we put in.

On day 1 that means that if I put in three times as much, then I'd have three quarters of the equity. As we both, over time, pay in equal amounts (or if, as we've just done, we pay down a fraction of the outstanding), then the percentage of the shared equity adjusts.

zzzLazyDaisy

John1993 wrote: »

What we decided is that we'd split all bills down the middle, and do the same with mortgage payments, and then when we sell, we'll arrange it so that each of us earned the same rate of return on what we put in.

The alternative is to have an agreement that protects the respective deposits and splits the balance equally.

Either way the agreement should be recorded in a deed of trust and lodged with the land registry.

John1993_2

:rotfl:

zzzLazyDaisy wrote: »

The alternative is to have an agreement that protects the respective deposits and splits the balance equally.

Either way the agreement should be recorded in a deed of trust and lodged with the land registry.

An equal split of the excess equity doesn't work for us, as we don't want the equity split in line with the deposits, we want it split in such a way that each of us has the same yield on our payments.

We've not lodged a deed of trust, we just want no misunderstandings between the two of us about who's brought what, when, to the ownership. I should probably look at formalizing it, though.

zzzLazyDaisy

John1993 wrote: »

We've not lodged a deed of trust, we just want no misunderstandings between the two of us about who's brought what, when, to the ownership. I should probably look at formalizing it, though.

That works as long as things remain amicable - but of course it is when things go belly up and the parties fall out in a big way that people look to the law to sort things out. At that point, if the property is held in joint names, the net equity will be split 50/50 on the basis that had you wished to have some other split you would have had this formally recorded at the time of purchase. So yes, it is certainly worth formalising the arrangement, just in case.

SavingSassy

My partner and I rent a house together. He earns quite a bit more than me and pays the rent, I pay all of the bills and the groceries (coming to about £50 less than him a month).... I know it's a different scenario, but some are suggesting this..... It wont work, both are paying similar to live there.

I would definitely get something arranged legally. It's sad to say but I know someone who bought her house, fell in love and after 5years of living together her OH left, she had to pay him money when she had the mortgage on her own for 20 years and paid in so much more than him.

Good luck for the future :-)