House buying and Prenup's

BronzeMarkymark

Ok, Prenup is not really the right word but sort of covers what I mean.....

I currently live with my girlfriend but do have a property that is currently rented out, I am looking at selling this and buying a place with my Girlfriend.

Now not wanting to sound mean but I have been married before and know that any relationship can breakdown, no matter how good you think it is, so basically want to cover myself.

If I sell my place I would make around £200,000 plus, which would go into the new place as a deposit, my girlfriend has nothing to add but I am looking at places around £340,000 so we would get a joint mortgage for this.....all this bit is pretty straight forward.

Now I need to know that if I die, my share of money goes to my kids, which has always been the reason behind my current property.

So basically, can I go to a solicitor with my girlfriend and draw up an agreement, I have heard these agreements are not worth the paper they are written on.....and what difference would it make if we did get married (no intention but you never know what the future brings)....

Key thing I want to be sure of is that if I die, my kids get back the minimum investment that I first put in and any extra down to what has been paid off on the mortgage.......

Also if we split up, would my girlfriend be entitled to half of the property, this would be as a girlfriend or if we did marry......

Might sound like I am being mean but have been married and know how even the best relationships can go sour and I just want to protect my kids future......

booksurr

you should own it as tenants in common NOT as joint tenants . Under TIC you have a defined share which you can leave to whoever you name in your will. If on the other hand you owned as JT , the survivor inherits the deceased person's share wholesale and that share cannot be left to anyone else . Assuming of course you write a will naming your kids as the beneficiaries of your TIC share !!!!!!!!!!!!!

If you are NOT married
as for how much your TIC share should be, firstly you need to agree with the GF whether you should get back i) an absolute £200k in cash or ii) the equivalent % of the property represented by an initial deposit of £200k
Obviously i) ignores the effect of inflation as you/your kids simply get back 200k cash, whereas ii) allows for inflation (house value rises) but also of course exposes you to getting back less than 200k if house value falls and, for example, you and GF split and you sell up before you die.

having agreed how to treat the deposit :
under option i) you would own 50% of the house with the first £200k of the sales proceeds going to you (/your estate) and the remainder of the cash (assuming it sells for >200k) being split 50/50 between you and your GF

under option ii) you would own (200/340) = 58.8% + ((100% - 58.8%) x 50%) = 79.4% of the property and GF would own 20.6%

if you are married
the divorce will start from the assumption everything is split 50/50. The outcome is down to negotiation and argument over who contributed what to the marriage, bearing in mind that "stay at home mothers" contribute in kind to the financial value of the marriage .....

Kynthia

It is sensible to consider what happens should your relationship breakdown or one of you should pass away when buying the biggest asset of your life using a loan that outlasts most marriages. Owning as Tenants in Common, a will, and a Trust Deed that outlines what happens should you split should cover most scenarios. The Trust Deed can outline the percentages of ownership but also list what happens should there be negative equity, who buys out who, etc etc.


Chat with your girlfriend and agree the plan, as it's for both of you to protect your assets and ensure a smooth split or distribution of the estate should that ever happen.

BronzeMarkymark

Excelllent, thanks to both of you for the responses, just what I needed to know........:T