Declaration(s) of trust

Thrugelmir

In signing the forms that you will be asked to sign by the mortgage lender. You will be waiving any financial interest in the property.

As has been said before. You should apply for a joint mortgage.

PerpetualStudent

In signing the forms that you will be asked to sign by the mortgage lender.
You will be waiving any financial interest in the property.

As has been
said before. You should apply for a joint mortgage

Ok, but what if that joint mortgage isn't possible - should I not sign these forms? Would a declaration of trust be pointless if I have signed?

Kynthia

PerpetualStudent wrote: »

Thanks again Kynthia - it isn't really a question of my boyfriend not being 'up for' this - it was a decision we made together (he, his parents and I). I take on your points though, and I'll certainly look more closely at my credit rating to see exactly where I stand.

...

I think we cross posted as I didn't see your post when I started writing mine.

I can see why you aren't buying jointly, and it's definitely understandable given the fact you don't have employment income. If it was just the deposit issue then the deed of trust could have dealt with this. Whether your boyfriend and his parents want a deed of trust is up to them and I don't think it impacts you as such, as long as any deed you get protects you. You'll also need to agree on what to put in the deed, as I'd imagine that you wouldn't get mortgage interest back but maybe half the capital repayments plus or minus any increase/decrease in value. However how would the renovation investment work, would you get all of that back or just the increase in value? Things to discuss and agree before completion perhaps.

As I said the marriage issue is only my opinion and I don't have any issue with unmarried couples. I only hope that people are aware of the difference and put things in place, like wills, to protect each other.

I hope it works out, but perhaps read up a bit more about cohabiting just to be sure your well informed. http://england.shelter.org.uk/get_advice/families_and_relationships/relationship_breakdown/options_for_homeowners/cohabiting_couples

PerpetualStudent

Thanks Kynthia - I am doing that reading as we speak! I definitely want to have these discussions with my partner and a solicitor - as I said above - though I love my boyf, I don't believe that means ignoring financial realities!

Discovered there's another way to fomally record financial agreements before moving in together - a 'Cohabitation Agreement' - anyone know if there's any difference between this and a declaration/deed of trust? Conflicting advice on different legal websites...

Also, as engaged couples are nearly always advised to get a pre-nup anyway, what especial security does marriage grant?

Kynthia

PerpetualStudent wrote: »

though I love my boyf, I don't believe that means ignoring financial realities!

You've made me smile. I've always thought that being in love doesn't mean you can't make sensible financial decisions, and that someone who loves you wouldn't want you to be at financial risk.

I don't know the difference between a deed of trust and a cohabitation agreement, but the solicitor might, although as you'd want it to be a legal document it would probably cost the same. It's possible that the latter doesn't require a property being purchased, so can be about what to happen if separating with jointly purchased furniture or a rental tenancy.

I wouldn't say people are advised to get prenups nowadays. Marriage to me is becoming a couple legally which means all assets are joint but that also the non-financial contributions to the 'family' are just as valuable. You work together for the best of the 'family' and support each other's goals. However I can see the purpose of prenups when there are significant family assets to protect from divorce, such as a trust fund, a family business or a house left to them by their grandparents. These weren't generated by one of the individuals marrying alone

maninthestreet

OP - you do realise you will probably have less rights than a lodger if the house and mortgage are only in your boyfriend's name?

PerpetualStudent

Hi Maninthestreet - thanks, yes, I am aware of the situation.
The flat and mortgage cannot be put jointly in my name for the reasons I detail above.
This is why we're looking into declarations of trust and other legal formalisations of our arrangement. Do you have any experience with arrangements of this kind? Would really love to hear advice on setting them up, what they can cost, if anyone's had experience of making recourse to them and if it was effective?...

I don't know the difference between a deed of trust and a cohabitation
agreement, but the solicitor might, although as you'd want it to be a legal
document it would probably cost the same. It's possible that the latter doesn't
require a property being purchased, so can be about what to happen if separating
with jointly purchased furniture or a rental tenancy

Thanks Kynthia, yes, it does sound like DoT (as I'm not going to call them, to save my fingers!) might be more specifically related to property ownership - possibly leading to them having more legal clout? More questions for the solicitor...

Think I might need to start 'legal rights of marriage' thread elsewhere (and sound more vunerable/like a golddigger than I evidently already do...) Does marriage really mean legally all assets are held jointly?

Richard_Webster

In signing the forms that you will be asked to sign by the mortgage lender. You will be waiving any financial interest in the property.

For what its worth, this isn't strictly true. You ar e waiving rights as against the mortgage lender.

You can't say to the lender "You can't evict me because the flat is partly mine..."

You can say to your partner: "I'm entitled to part of the sale proceeds." If you have a deed of trust then you could ask the Land Registry to register a restriction preventing a sale without your consent. This would not bind the lender because it would have been registered after their mortgage. So if they repossessed you would have to chase your partner for the net proceeds.

Personally(my rant...) I can't understand why anyone would contemplate such a great financial commitment without marriage, which means you have to ask the question about commitment on his part. I am a grandfather so my views might be considered old fashioned, but there you are. Possibly he does see it as sucha big deal, but it does end up being like that if things go very wrong later.

Marriage does not have to cost £10,000+ as some wedding arrangers would have you believe.

weeg

Can I come sit next to you PerpetualStudent?

I'm selling my flat and handing all the equity to my boyfriend to use as a deposit for a flat for us both. It will be his mortgage in his name. He doesn't believe in marriage. I couldn't get another mortgage if the banks were dropping them out of planes (too many defaults, unpaid debts, !!!! all income from self employment).

So we've talked about money. We're having the lawyer draw up an agreement 'in case'. (he'll pay the mortgage in it's entirety until what he has paid equals what I have paid, then we'll go halves. Any equity we accrue would be split equally. We'll go halves on renovation costs). His life insurance will more than cover the mortgage costs and our wills will reflect our mutual commitment to each other.

Possibly it would be cheaper to get married, but that's not going to happen in my relationship or yours by the sound of it, and I find it quite ridiculous that people say it's the solution. Like it might never have occurred to you - you're doing a phD, I'm going to go ahead and assume you're not stupid!

PerpetualStudent

weeg wrote: »

Can I come sit next to you PerpetualStudent?

Yes Weeg, please do - though I warn you it is apparantly the Unmarried Seat of DOOM!!

Im really glad to hear other people are in a similar situation - over on the marriage/relatonship section of the forum there's a lot more of them too. I think it speaks volumes that while marriage might still be the simplest legal way to tie issues like this up, it still either consciously or instinctively doesn't instantly occur to a 21st century generation of newly cohabiting couples.

That said, my partner & I don't happen to be in anyway against marriage - TBH whenever it's been discussed it's been a matter of when, not if. So who knows, it might be a cheeky nip down the registry office before long, or it might we prefer to write up our own legal agreement via a declaration of trust & leave the wedding bells for when we can afford to ring them loud...

Richard, thanks for the advice re mortgage forms. Though for my personal rant - I am tickled by the idea Im the only one at risk here - if we didn't get something binding me to this flat I could gad off with the next dashing young thing who turns my head and leave my partner saddled with not only all his own mortgage, but also the debt to his parents & my share of all bills/freehold responsibilities. No skin off my nose, save the cash I would have spent otherwise renting in any case & Im free as a bird while he's calculating intrests rates & fixing the roof. Why is the lack of commitment seen as being on his part & not mine?!