Unmarried house purchase with unequal shares

Jess0214

My partner and I are not married but are both in the process of selling our own properties and purchasing a property together. We are contributing unequal shares towards to deposit for example I am contributing around a 70% share and he is contributing around a 30% share but once we move in our contributions to the mortgage will be around 50/50. My preference was to marry prior to purchasing a property together but he has been insistent on getting married later. After a stressful and rocky past few months combining our families and going through the house sale I am concious to enough I set up the correct protection for my investment should our relationship break down in the future. Do we get a trust where we receive our deposit back plus 50% of any growth made? Would this still be a fair way to do it if he left me within a year say? What options do we have that make it fair for the both of us?

getmore4less

Getting the deposit back is like lending 1/2 your deposits to each other.

If this was £100k split 70:30 you would be lending £20k to the OH interest free.

Another way is where you buy a share of the house with your deposit.

The mortgage buys a share as well which you split 50:50

with £100k deposit and £100k mortgage you own £130k OH £80k

but to keep that straight you need to contribute to maintenance in the 130:80 ratio.

Another option is to own 50:50 by splitting the mortgage

with with £100k deposit(70:30) and £100k mortgage you split the mortgage 30:70 you pay 30%

adjust for deposits and mortgage sizes.

Don't forget all costs need to be include in the starting cost not just the price of the house.

lindens

You need a deed of trust drawn up by a solicitor that you both agree to and sign

getmore4less

the money side of DOT is the easy bit.

Agreeing any triggers and options is the hard part.

Start with one of you passing away.
Then move onto just splitting up.

Jess0214

Unfortunately paying unequal shares of the mortgage payments wouldn't work for us. I hadn't even thought about the triggers yet. How stressful!

getmore4less

The simplest option is you treat it as a interest free loan, or some side agreement on that money where they pay interest or pay you back.

When you say families if there are kids involved(one or both sides?) that can complicate.

Have you lived together already in one of your properties?

Jess0214

Yes we each have a child from a previous relationship and yes we're currently living in my property and the sale of his has already completed

Tom99

[FONT=Verdana, sans-serif]You would buy the property with a joint mortgage as tenants in common with a separate deed of trust.[/FONT]
[FONT=Verdana, sans-serif]The DOT would set out that you bought house for say £200k incl fees that you paid £70k up front and your partner £30k also that mortgage payment were to be paid equally. The deed of trust would then say something like this.:[/FONT]

[FONT=Verdana, sans-serif]'On the sale of the property and after paying the sale costs and redeeming the mortgage the proceeds of sale shall be split as follows:[/FONT]
[FONT=Verdana, sans-serif]Party A – 35% of the gross sale price less costs of sale[/FONT]
[FONT=Verdana, sans-serif]Party B – 15% of the gross sale price less costs of sale[/FONT]
[FONT=Verdana, sans-serif]The Remainder – split 50/50 between Party A and Party B
[/FONT]
[FONT=Verdana, sans-serif]There are lots of other clauses you could add in if you wanted to, how bills are split, what if partner cannot keep mortgage up, what if property sells at a loss etc. but don't get tied up in knots trying to cover every eventuality. For many partners the formula as to how the net sale proceeds are to be split will do.[/FONT]