Deed of trust - legally enforceable?

Guest101

adonis10 wrote: »

Echo what chris_m said.


You have your opinion and that is fine, however my particular question was not about opinions, rather about the questions in my post. Unless you'd like to answer them, perhaps save your replies for a thread with the title "what is your opinion on the Deed of Trust" where your replies will be both relevant and welcomed.

You've jumped in on another person thread to ask your own question and then dictate to me how I should reply, on a public forum?


On top of that, your question was 'Any thoughts?' - but you didn't like the answer I gave.


I couldn't care less that you don't trust your girlfriend, but don't start dictating to me.

adonis10

Guest101 wrote: »

You've jumped in on another person thread to ask your own question and then dictate to me how I should reply, on a public forum?


On top of that, your question was 'Any thoughts?' - but you didn't like the answer I gave..

Yes, 'any thoughts' related to the questions I asked, rather than general thoughts on the concept of the deed of trust. I also feel that the OP was not asking for opinions on the concept of a DoT, but more specific questions.

Guest101 wrote: »

I couldn't care less that you don't trust your girlfriend, but don't start dictating to me.

I do trust her, however I don't see the issue with covering every angle. Money can do strange things to people. That doesn't mean that it definitely will, it means that it can do and I'd rather not take the risk, even if I am pretty damn sure that it won't be an issue in the long run.


And I'm not dictating to you at all, you are free to type what you want and where, however I just wonder why you're wasting time replying to questions that haven't been asked. The OP said "All advice and wisdom greatly received! " which, to me, suggests that they are looking for experiences of people who have had them and with knowledge of whether they are legally enforceable (asked in an earlier paragraph) rather than "what do people think of them from a moral perspective?".

HappyMJ

pph wrote: »

Thanks Guest 101 but we're sorted - but we're youug and who know's how we'll feel in 15yrs. We have the deposit, there's not point in paying someone else's mortgage.

So I appreciate the comment, and agree, but I'd rather the thread didn't go that way.

So it's only enforcable if we're married?

You know there isn't much difference in the total cost of ownership when buying versus the total cost of rent payments and saving.

If you've got a deposit you should be able to get at least 3% interest on your money. I get up to 6% on some of it. Put your deposit in the bank and use the interest to pay the rent.

If I was signing the trust deed I would ensure there is a clause saying no sale can be forced during the fixed period of the mortgage. That could be the first 5 years. I would also require 6 months notice to buy the other persons share out or put the property on the market rather than 3 as you've suggested.

Who determines what price it's put on the market at? You both have to agree to an offer. If one person wants to they can refuse every offer that has been made.

Guest101

adonis10 wrote: »

Yes, 'any thoughts' related to the questions I asked, rather than general thoughts on the concept of the deed of trust. I also feel that the OP was not asking for opinions on the concept of a DoT, but more specific questions. - Any thoughts on your DoT. But not 'any' thoughts. Just the ones you want to read? Anyway, I think your idea is full of issues. Such as splitting selling costs, is it 88:12 60:40, what? If you decide to rent it out, instead of selling, how is the rent split?



I do trust her - just not enough to buy a property without a legal document ensuring she doesn't try to rip you off? , however I don't see the issue with covering every angle. Money can do strange things to people. That doesn't mean that it definitely will, it means that it can do and I'd rather not take the risk, even if I am pretty damn sure that it won't be an issue in the long run. - if you say so.


And I'm not dictating to you at all, you are free to type what you want and where, however I just wonder why you're wasting time replying to questions that haven't been asked. - because it's not just you reading the answers... The OP said "All advice and wisdom greatly received! " which, to me, suggests that they are looking for experiences of people who have had them and with knowledge of whether they are legally enforceable (asked in an earlier paragraph) - which I answered and said they were ? rather than "what do people think of them from a moral perspective?".

It's nothing to do with morals. I'm not judging you or your girlfriend based upon any knowledge of you are individuals. I'm saying that the very basis of a 'deed of trust', the reason they exist (the hint is in the name) is because the parties do not trust each other.


As eddddy put it: But perhaps all the arguments and bad feeling generated between couples whilst working out these details will mean they split up anyway, before they've bought the property. So perhaps the problem will solve itself.

adonis10

Guest101 wrote: »

It's nothing to do with morals. I'm not judging you or your girlfriend based upon any knowledge of you are individuals. I'm saying that the very basis of a 'deed of trust', the reason they exist (the hint is in the name) is because the parties do not trust each other.


As eddddy put it: But perhaps all the arguments and bad feeling generated between couples whilst working out these details will mean they split up anyway, before they've bought the property. So perhaps the problem will solve itself.

FYI, we've had no arguments or bad feeling when discussing it. It was actually her idea to do it as additional reassurance for me.


In terms of splitting costs, we would be quite clear:


Selling costs - 50:50
Renovation, decoration etc. - 50:50
Bills - 50:50
Furniture - 50:50
If we rent it out - mortgage gets paid, any excess split 50:50 (I'm not so anal as to say "I put in a lot more so I should get an extra £xx from the rent surplus etc.)

So, the vast majority is 50:50, however I just don't want to be in the position where I could potentially lose 60-70k for the sake of a £150 document. The only curveballs are with the deposit and subsequent equity paid off. So, now we've had our little disagreement, what do you think would be a good approach to this? Leaving aside opinions on the DoT etc., purely from a financial split point of view.

Guest101

adonis10 wrote: »

FYI, we've had no arguments or bad feeling when discussing it. It was actually her idea to do it as additional reassurance for me.


In terms of splitting costs, we would be quite clear:


Selling costs - 50:50 - Does she agree? Since % wise it's higher for her than you.
Renovation, decoration etc. - 50:50 - Does she agree? Since % wise it's higher for her than you.
Bills - 50:50 - well obviously. Bills are nothing to do with the property.
Furniture - 50:50 well obviously. furniture is nothing to do with the property.
If we rent it out - mortgage gets paid, any excess split 50:50 - (don't forget tax) Do you agree, as the interest on your deposit is lessened, but her increased


So, the vast majority is 50:50. The only curveballs are with the deposit and subsequent equity paid off. So, now we've had our little disagreement, what do you think would be a good approach to this? Leaving aside opinions on the DoT etc., purely from a financial split point of view.

It seems so simple, but here's a hypothetical:


These are example numbers.


You buy for £150,000


88k from you
12k from her
50k mortgage


The monthly mortgage is £400, you pay £160 she pays £240. So far that's roughly what you'd suggested.


Now you decide a new kitchen is in order, but that is split 50/50. lets say £1,000 each, the value of the property goes up by £10,000.


Now if you've lived there only a month and split up, you're still by far the majority owner, she's only paid £13,240, you've paid £89,160. But there's now £8,000 there. Do you split that 50/50, thereby she's getting 30% interest rate on her investment, whilst you get 5% (less than you could've putting in in the bank) is that fair. She wouldn't have made that without your contribution, but you would've made more despite hers?


How does your deed of trust account for that?


Same scenario in 10 years time, and she's paid almost £8000 more than you to the mortgage, should the increase be hers?

adonis10

Guest101 wrote: »

It seems so simple, but here's a hypothetical:


These are example numbers.


You buy for £150,000


88k from you
12k from her
50k mortgage


The monthly mortgage is £400, you pay £160 she pays £240. So far that's roughly what you'd suggested.


Now you decide a new kitchen is in order, but that is split 50/50. lets say £1,000 each, the value of the property goes up by £10,000.


Now if you've lived there only a month and split up, you're still by far the majority owner, she's only paid £13,240, you've paid £89,160. But there's now £8,000 there. Do you split that 50/50, thereby she's getting 30% interest rate on her investment, whilst you get 5% (less than you could've putting in in the bank) is that fair. She wouldn't have made that without your contribution, but you would've made more despite hers?


How does your deed of trust account for that?


Same scenario in 10 years time, and she's paid almost £8000 more than you to the mortgage, should the increase be hers?

All the bits in red where you ask "do you/does she agree?", answer is yes. We're trying to make it as simple as possible. Re the rent, we'd rent for 1k - 650 mortgage - 20% so about £280 left over so it's not a significant enough amount to get picky about.


Re your other example, I think we would just agree to 50:50. I know it sounds daft but one thing may benefit me and the next may benefit her. The main issue here is the deposit is protected. Otherwise we'll be going through all sorts of "what if?" scenarios.

Guest101

adonis10 wrote: »

All the bits in red where you ask "do you/does she agree?", answer is yes. We're trying to make it as simple as possible. Re the rent, we'd rent for 1k - 650 mortgage - 20% so about £280 left over so it's not a significant enough amount to get picky about. - Your mortgage wouldn't be £650 for a start. You don't get to deduct your whole mortgage for tax purposes for another. But I wont bore you with the details. Just make sure that should you ever decide to rent out, you come back and learn the basics


Re your other example, I think we would just agree to 50:50. I know it sounds daft but one thing may benefit me and the next may benefit her. The main issue here is the deposit is protected. Otherwise we'll be going through all sorts of "what if?" scenarios.

In 20 years time the deposit could be worth less than a small second hand hatchback.


Why not just buy in one persons name, the other saves up the equivalent and then buys into the property?

getmore4less

Guest101 wrote: »

I don't think people should buy properties with people they don't trust.


A deed of trust is in essence saying: I don't trust you to keep your word and therefore I want it noted down legally.

The deed just documents what you agreed so there is no future misunderstandings on what was agreed.

If you can't right it down in detail then trust is irrelevant as you have no idea what you are "trusting".


Most are borderline useful as they rarely cover the the things that go wrong in enough detail to make them work.

And many get the financial side messed up as well and that is the really easy bit.

Guest101

getmore4less wrote: »

The deed just documents what you agreed so there is no future misunderstandings on what was agreed.

If you can't right it down in detail then trust is irrelevant as you have no idea what you are "trusting".


Most are borderline useful as they rarely cover the the things that go wrong in enough detail to make them work.

And many get the financial side messed up as well and that is the really easy bit.

I agree, most aren't actually well drafted and end up being useless.


But the point is, you should trust your partner to do that right thing. If you need a legal document to ensure that, there's already a crack in the foundation of the relationship.