Finances when buying a house as a couple

startingout2016

We are in the process of buying a house.

I earn £35k per year. My partner earns £27k per year.

Deposit, stamp duty and other costs to buy the house is in the region of £45k which includes a refurbishment budget.
This money is coming from my savings.

My partner does not have savings to contribute.

My savings come from a mixture of having sold my last house, and downsizing my car.

I am also pregnant and expecting our baby to arrive in late spring time.

The house we are buying will need some refurbishment work, most of the work will be carried out by my partner in his spare time,
along with help from his family.

My partner is worried that he is not contributing enough to the house purchase.

My thoughts is that in the long run these things equal out. I will be taking maternity leave where he will be supporting me,
and further down the line my earnings could drop if I go back to work part time rather than full time (not decided).
His earnings could increase too.

Is there anything else I can do that will reassure him that he is very much an equal joint party in all of this and he has nothing to worry about?

G_M

'Partners' so not married?

Bear in mind joint property ownership is a bigger commitment than marriage.

And there's less protect in the event of separation.

You could own the property as 'Tenants In Common', splitting ownership in whatever % you wishvia a Deed.

jojo9239

We had something similar I bought the house with my nanas inheritance but we were getting married so the house is in both of our names maybe silly maybe not but I don't see it's my house its ours

Eilis

i did tenants in common and it works out better in the long term in case you split. I know advising this is negative but you never know what the future holds.
As you are putting the deposit, you could own a larger share in the house. What is also ideal, when your tenants in common is to leave your percentage of the house to your child in case anything happens to you. I say this as I have witnessed my previous partner lose his inheritance when his mother remarried, Sadly some step parents can be savvy.
We stipulated in our will that if one of us dies and cohabits for longer than 12 mts we would have to sell the house and give a percentage to our daughter. We wanted to prevent another partner/marriage from getting what is in fact our daughters inheritance.

Kynthia

While it's admirable you want to share what you have and show him that you are equal partners, doing this without marriage leaves you vulnerable. There is no seperate law for couples who live together but don't marry so if you split things come down to whether they are own jointly or not and who can sue for what. Your money is vulnerable if you own as joint tenants without a trust deed protecting your deposit.

Yes things would even out eventually if he supports you on maternity leave and then perhaps should you not return to work or go part time. However what about if you break up relatively quickly? Say something happened in 6-12 months time, he automatically would get half the equity in the property despite virtually all of it being your deposit. I know you think it's not likely but both people on a relationship shouldn't let the person they care about put such a lot of their money or their home at risk. You could always rescind any trust deed you put in place after a couple of years if you wish, or it would become irrelevant if you married. It doesn't have to mean you won't eventually completely share your finances as a couple.

startingout2016

We are discussing marriage in the near future. Is a deed of trust something still worth doing in the interim?

If I had a deep of trust would that be arranged with the solicitor or broker?

-taff

Arranged with the solicitor. Fairly simple too. You protect youe deposit then the only thing is deciding what the equity split would be if you sold.

Kynthia

startingout2016 wrote: »

We are discussing marriage in the near future. Is a deed of trust something still worth doing in the interim?

If I had a deep of trust would that be arranged with the solicitor or broker?

I would have a trust deed even though I love and trust my partner as I don't believe you need to out serious money at risk just to show love and trust. I know everyone is different but I believe having a child with someone, marrying them, making compromises together and wanting them to be happy and have their needs met show love and trust. Once you are married then it's all marital assets and it won't matter.

Get your solicitor to draw one up for a few hundred during the purchase. Agree what it says with your partner but I'd go with something like 50:50 ownership but you get your deposit back before any remaining equity is split. If you want to acknowledge his non-financial contribution to the works he's going to do and show that you are invested financially in this too you could write off the fact you are paying the stamp duty and legal fees (I assume the refurbishment budget is already seperate to tge purchase costs). Generally come up with an agreement that works for you both as the discussion and agreement are as important as the end result. So as long as you are both happy and one of you isn't risking massive amounts of money then it can all be reassessed, perhaps in 3 years if you aren't married.

cooltt

startingout2016 wrote: »

We are in the process of buying a house.

I earn £35k per year. My partner earns £27k per year.

Deposit, stamp duty and other costs to buy the house is in the region of £45k which includes a refurbishment budget.
This money is coming from my savings.

My partner does not have savings to contribute.

My savings come from a mixture of having sold my last house, and downsizing my car.

I am also pregnant and expecting our baby to arrive in late spring time.

The house we are buying will need some refurbishment work, most of the work will be carried out by my partner in his spare time,
along with help from his family.

My partner is worried that he is not contributing enough to the house purchase.

My thoughts is that in the long run these things equal out. I will be taking maternity leave where he will be supporting me,
and further down the line my earnings could drop if I go back to work part time rather than full time (not decided).
His earnings could increase too.

Is there anything else I can do that will reassure him that he is very much an equal joint party in all of this and he has nothing to worry about?

Wow! I've never read such nonsense responses to a straight forward question in my life. Quick nail him down under a mountain of contractual obligations before he makes off with one more jam tart than you. Honestly!

It's amazing how everyone is suddenly an expert on everyone else's relationship from a few sentences. Some really deep seated trust issues in these responses.

OP
What a fantastic relationship you and your partner seem to have and what you're willing to do out of the love in your heart. All I'd like to say here is Mr Startingout is having a little ego malfunction.
The thought of the you holding the reins on this little endeavour has rocked his manly, I should be looking after you, protective world a little. It's how men are conditioned.

All that's needed here is to sooth his ego a little, tell him it doesn't change anything or how you feel about him. It's a practical decision not a power grab on your part to contribute more because you're BOTH working toward the same goal right?
And yes things will even themselves out in time it just so happens that on this occasion you are able to provide a big vote in confidence on your future together.

LittleMax

cooltt wrote: »

Wow! I've never read such nonsense responses to a straight forward question in my life. Quick nail him down under a mountain of contractual obligations before he makes off with one more jam tart than you. Honestly!

It's amazing how everyone is suddenly an expert on everyone else's relationship from a few sentences. Some really deep seated trust issues in these responses.

Everyone believes their relationship will work out. Sadly this is often not the case. People are advising based on experience.

Having sat in the solicitor's office with my friend, hearing that had they been married it would be different, was not an experience I would wish on anyone. What I find difficult is that it is, in effect, the children of the relationship breakdown that are treated differently in law, and can end up worse off if their parents lived together rather than married. I don't believe people realise this and if they ask it should be explained. It is up to them whether they choose to listen.

I know that if she could go back 10 years, my friend would have married.

As for me - I don't have children, never planned on having them. I put in a larger share of the deposit 20 years ago and we had a deed of trust. Over the years things have evened out, and 20 years on, we no longer have that; everything is 50:50. Just because you have a deed of trust doesn't mean you think it isn't going to work out.

david1951

Rest assured a deed of trust is not a "mountain of contractual obligations" and doesn't imply any sort of "deep seated trust issues". If my partner refused to sign one I would put that down to insecurity on their part. As Kynthia says you don't need to put serious money at risk just to show love and trust.