Moving partner into your house with mortgage

tiapili

Hello, I wonder if anyone could advise or tell me about their experience with this?
I am about to purchase a house as the sole mortgage applicant. I will be the only name on the deeds. I have a boyfriend, relationship about 1 year in, and going really well.
We have talked about living together but are in no rush, but as I recently came into some money it seemed best to buy a place that I could afford alone but would potentially be suitable for us together down the line.
So if he moves in - he has no 'upfront' money but a good income (earning more than me) so no worries there. I've been in that same situation, renting for years and am now fortunate not to be!
For me, it feels wrong just to charge him rent so I conjured up this (figures just illustrative):
If the mortgage was £1000 a month consisting of £700 repayment and £300 interest, we split this in half, and his £350 of repayment buys a share in the house. A couple of years down the line, say it doesn't work out and he moves - he gets his equity back (not interest) plus any house value increase on that (figure determined after taking into account my initial investment of legal fees).

What do people think? In a way I'm giving him a 0% deposit mortgage? I benefit because some of my interest is paid (plus I will save a lot more of my income which can be invested), he benefits because all his money isn't being poured into the black hole of rent.

This feels right to me but perhaps I am missing out something. Also I don't know how to go about getting this legally written up, which I'd like to.

Thank you for reading.

Nasqueron

I don't know about legally but I moved in with my partner after a couple of years and she had owned the house for 3-4 years. She earns a lot more than me (nearly 4x) and pays all the bills, I pay a contribution of rent which I think she uses towards overpayment of mortgage. I have no claim on the house (as in, I don't want to, it's morally not something I agree with)

You'd do better speaking so a local solicitor for the 30 minute free session and see what they would quote to write that up

saajan_12

What you've suggested sounds fair.. your partner is effectively taking on half of the mortgage and paying half of the interest. Say you have a 80% mortgage initially, then the partner has 40% share in the house, and must pay off half the mortgage from their share - this would take into account any increase / decrease in property value. You have a 60% share in the house (deposit + your half of mortgage).

In my opinion you should then split regular bills in half as you are both living there, but pay for capital improvements / renovations in those shares.

Partner does benefit by getting a mortgage at a good rate with no deposit, and has no long term commitment / liability to the lender so you would be stuck chasing him if any chance of negative equity etc. Conversely, if you split up while not in negative equity and partner wanted his share in the equity (so 40% of value - half remaining mortgage) you would have to
a) pay that out of your savings
b) remortgage to get raise those funds
c) pay when you sell.

As a) and b) may be impossible depending on your circumstances, it may be wise to agree now that you only have to pay when you sell (so both your money is tied in long term, if he wants less commitment then he should consider his contributions as rent which he doesn't get back).

getmore4less

tiapili wrote: »

Hello, I wonder if anyone could advise or tell me about their experience with this?
I am about to purchase a house as the sole mortgage applicant. I will be the only name on the deeds. I have a boyfriend, relationship about 1 year in, and going really well.
We have talked about living together but are in no rush, but as I recently came into some money it seemed best to buy a place that I could afford alone but would potentially be suitable for us together down the line.
So if he moves in - he has no 'upfront' money but a good income (earning more than me) so no worries there. I've been in that same situation, renting for years and am now fortunate not to be!
For me, it feels wrong just to charge him rent so I conjured up this (figures just illustrative):
If the mortgage was £1000 a month consisting of £700 repayment and £300 interest, we split this in half, and his £350 of repayment buys a share in the house. A couple of years down the line, say it doesn't work out and he moves - he gets his equity back (not interest) plus any house value increase on that (figure determined after taking into account my initial investment of legal fees).

What do people think? In a way I'm giving him a 0% deposit mortgage? I benefit because some of my interest is paid (plus I will save a lot more of my income which can be invested), he benefits because all his money isn't being poured into the black hole of rent.

This feels right to me but perhaps I am missing out something. Also I don't know how to go about getting this legally written up, which I'd like to.

Thank you for reading.

paying 1/2 the mortgage is the same as have an interest in the bit that mortgage bought.

eg you put down 40% mortgage 60% if they pay 1/2 they own(beneficial interest) of 30%.

that's the easy bit, the hard bit is if you split up is paying that equity out(less 1/2 the debt remaining) if the value has gone up a bit and you don't have the savings to cover it.

ReadingTim

• You buy the house in your name only and pay 100% of the mortgage on it
• You charge him 50% of the the bills, council tax etc, ie the cost of him being there.
• He saves an amount equal to half your mortgage payments each month into a savings account - for a deposit (as it were)
• If you're still together in a couple of years, he pays you his deposit, and the pair of you remortgage in joint names, or as tennants in common

At this stage you want to make sure he doesn't have any kind of claim against the property should things go belly-up. Once you're reasonably sure they won't, he needs to be bringing something to the table if he wants half the house...

That's how I'd look at it anyway...

gettingtheresometime

Will he be allowed to move in by the mortgage co ?


I thought that the mortgage co asked if anyone over 18 would be living at the property and whether they had a beneficial interest in the property - which he would have if he paid half the mortgage payment

bargainbetty

ReadingTim is bang on - if you are putting up the deposit and are legally solely responsible for the mortgage, then you should protect your own interests for now.

gettingtheresometime also has a point in that anyone with a beneficial interest in the property will be of interest to the mortgage company.

If he wants a share, he saves up and buys a share at remortgage time. Until then, a straight split of the bills protects you from life's little cowpats.

And before you tell us that this is true love and you know it won't end badly, have a look at any number of threads on these boards about people who are stuck paying for debts or paying off partners legal claims because they decided to do business transactions based on hearts and 'parts' rather than brains and evidence.

Very best of luck with your new home!

EmmyLou30

I had my own home for 5 years before the boyfriend moved in (who earns 30% more than me). We decided he'd pay half towards the mortgage and all the bills but have no interest in the house and his name was on nothing except the council tax/electoral roll, so if things went wrong he'd walk away with nothing (but as half the mortgage and bills was less than his rent and bills alone on a 1 bed flat he was clearly getting to live for less than he was before so he was able to save money by living in my house so he was benefiting - even if it wasn't by way of a stake in the house).

Looked at another way, I only paid £1500 a year off the capital of my mortgage....so if he lived with me for a year he'd be entitled to £750 'equity' plus half of any increase in it's value which is next to nothing where I live so even if we had agreed I'd give him half of what he'd contributed to it wouldn't have equated to much.

I think either of those options is fair really.

As it happens we're now married and have moved to a new house that we went into 50:50 :-) But definitely protect yourself by agreeing what's fair just in case.

hounsehunterftb

Yes the plan sounds fair given the current circumstances. Legally how it all fits, I hardly am aware of. However just make sure that say god forbids and something goes wrong between you two, you are potentially committing him some equity of the house. So he would expect it back if you do split up. You would need to have the money upfront then. Because not necessary you would want to sell the house. Something to think about

I would instead let him have more of a share in groceries and stuff while I am the one solely responsible for the mortgage. You could work out the daily expenses in a way where you spend very less and he spends more.

Later when you feel more confident or he has some saving done himself you could add him to mortgage perhaps. When you are considering to remortgage maybe

tiapili

Thank you all so much for all these considered responses - lots to think about. ReadingTim your suggestion is one I hadn't thought of and makes a lot of sense. Of course, whilst the relationship is great at the moment, this discussion is all about planning for if it isn't, and determining something that will feel fair now and fair 'then'. The vague longer term plan (3-5 yrs) is to buy a bigger/better place together. And I will certainly look into any implications with him living there/mortgages.
Thanks again!

deFoix

Whatever you decide a good lawyer would tell you to get the agreement drawn up in writing.

It's a bit sad that couples have to conduct their personal lives in a kind of business-like fashion and make domestic arrangements into a commercial negotiation but that's just a result of the 21st centurary "liberal" individualistic society we live in today.

Don't get me wrong, I'd do the same, but when everyone is claiming of everyone else these days you have to protect no.1 (although in 90% of cases its girlfriends/wives rinsing boyfriends/husbands).