Un-Married Couple buying house together

kforshaw

Me and my ex bought the house we are both living in in 2003.
I put up the deposit (£2500) and he bought a sofa/tv/ various bits and bobs to the equivalent.
Nothing was ever put legally as as far as I'm concerned, we both put up the same amount.

We split in 2009 but we still both share the house ( albeit separate bedrooms I should add!) as it is an amicable split.
He's now going through the application to do a transfer of equity to me as I'm moving to be with my long distance partner.

As all household bills and mortgage etc have always been split 50/50 - I have no issue with only accepting the 50% of the equity, however I'm not chasing him for 50% of the deposit as we both had the benefit of the things he bought.
I appreciate some splits may not be as amicable though, so I figure legally something should be put in place.

penguingirl

My partner and I have co-owned a property since 2009 but always divided everything 50:50 and had equal deposits. We are now about to move and he is putting in more than me as a deposit but we will continue to split mortgage payments equally. We have worked out what % of our new house we are each putting in, what is equal deposit (from equity in our current home) and what will be a joint mortgage. If we were to split we would each take out the relevant %s and fees would come from the joint pot. We don't have this drawn up officially, but are in absolute agreement it is fair for both of us and will have the relevant %s written down somewhere. We have also decided we will continue as joint tenants rather than changing to tenants in common (which some people choose to do)

I think this is an issue that is complicated by if you have negative equity which was common a few years ago. It potentially resulted in people not having enough when they sold to cover the mortgage and arguing about who paid the remaining debt.

firebird082

I'm always intrigued by people's different approaches to this! My partner and I did the same last year, and we are intending to marry in the next year. We went for the joint tenants option, considering future children, and wanting to make sure the remaining partner in case of death is not left without the house. Deposits weren't exactly equal, but we made a decision that if the worst happens, a 50/50 split is the easiest option, as we both put different things in to the house (in terms of time/money/furniture etc). As long as you have the conversation with your partner then I guess it doesn't really matter! Which reminds me, we really must get our wills written soon...

lazer

There are a few ways of doing it:


For example sakes lets say house is £100k and 20% deposit (£20k - £15k BF, £5k GF)


1 - protect the deposit, the first dibs on the sale of the house would be the deposit, so house sells for £150k, £15k goes to BF, £5K goes to girlfriend, the remaining equity gets spilt 50/50.


2 - Calculate the share of the house the deposits buy (£15k would buy 15% of the house, and the £5k would buy 5% of the house) - so when sold BF first gets back 15% of the equity, GF gets back 5% of the equity, remainder is spilt 50/50.


So house sells for £150k (Mortgage remaining is say £70k - so net equity is £80k). BF gets 15% of the house - £22.5k, GF gets 5% £7.5, the remaining £50k net equity is spilt equally - £25k each. .


Make sure you also cover what happens in if you are in negative equity if you sell

md87

As others have said, this is definitely done by the Solicitor once you are going through with a purchase - i.e. you will have to choose how you want to own the property. You can own it as Joint Tenants, Tenants in Common etc. I forget (without looking) which each one means. But basically you can own a "share" in the property based on your contributions towards the purchase price (i.e. you own say 70% and your partner owns say 30%). Otherwise you can choose to own 50/50 despite the fact that one of you may have contributed more. There is another option whereby you both own the property in full, irrespective of your contributions towards the purchase price. In this scenario Rights of Survivorship apply (whatever it is called) so if one of you passed away the other surviving partner would own the whole of the house, as opposed to other methods of ownership whereby half of the house for example could be passed to someone else in a will. Can get quite complex but your Solicitor should explain each one clearly and you can choose as you wish.

I was in same position about 4 yrs ago when me and my partner got our first house. We already had a child together and had been together 5+ years. I probably contributed slightly more but we just owned jointly together with the right of survivorship applied. We have since married and have more children. Guess it only becomes a real problem if you split and especially if the house value falls. We bought at a good time so in our case the property was unlikely to go down and in fact has gone up (just sold 4 yrs later for +20k of what I paid).

Mojisola

md87 wrote: »

you will have to choose how you want to own the property. You can own it as Joint Tenants, Tenants in Common etc.

There is another option whereby you both own the property in full, irrespective of your contributions towards the purchase price. In this scenario Rights of Survivorship apply (whatever it is called) so if one of you passed away the other surviving partner would own the whole of the house, as opposed to other methods of ownership whereby half of the house for example could be passed to someone else in a will.

'Joint tenants' means that you both own all the property. If one dies, the other still owns all the property.

'Tenants in common' means you own designated shares of the property - could be 50/50, could be 90/10. If one owner dies, their share of the property will go to whoever is named in the will or according to the intestacy rules if there isn't a will.

AdrianC

Guest101 wrote: »

Please note also, that in the event of marriage, the split would likely change.

Why? Marriage is just a piece of paper, no more. Getting married doesn't - or shouldn't - change how you feel about each other or how strong your relationship is.

(FWIW, together 18.5y, unmarried, living together ~17yrs, joint tenants for all that time)

Mojisola

AdrianC wrote: »

Why? Marriage is just a piece of paper, no more. Getting married doesn't - or shouldn't - change how you feel about each other or how strong your relationship is.

Marriage isn't just a piece of paper - it's a legal contract.

penguingirl

AdrianC wrote: »

Why? Marriage is just a piece of paper, no more. Getting married doesn't - or shouldn't - change how you feel about each other or how strong your relationship is.

But it does change how you are considered financially and the lesser-owning party may end up with more rights to the property than they started off with as assets are considered joint, particularly if the marriage is of any significant length of time or there are children

chewmylegoff

TBagpuss wrote: »

Discuss with your solicitor.

The simplest way to deal with it is to simply say that you will get your deposits back, and any net split equally.

This will mean that you don't get a 'return' on the investment of your deposit, but realistically, you are most likely to need to rely on the deed if you split in the early years of owning the property.

You can base the deed on percentages instead.

This is what OH and I did. Our conveyancing solicitor drew it up and charged us £100 for it (which given the amount of the deposit at issue is an inconsequential amount to pay for having it done properly...).