Declaration of Trust confusion

Pinkwhippet

Hi, We are in the process of changing our mortgage and house deeds from my ex and I to my current partner and I. We intend to do this as Tenants in Common in unequal shares. However the solicitor has now said we should have a Declaration of Trust. We are a bit confused as we didn't think we needed this if we are going for Tenants in Common in unequal shares. Can anyone advise if this is necessary and required by law? And what the purpose of it would be if we have already agreed our percentages. Thanks in advance

SmashedAvacado

to be tenants in common in unequal shares you have to have a declaration of trust. Its non negotiable and impossible to achieve without one. What the solicitor is probably also recommending is that you go into a bit more detail about how your unequal shares work. Because many people forget to think about the deposit put into the property, the monies put in as mortgage payments, the monies put in as capital improvements, the monies put in as maintenance and then if they do split up its not actually clear on what was intended.

Tom99

Why are the shares unequal?
Be very wary of just agreeing a simple percentage split if you have a mortgage because in most cases you will not get the result you expect.
The split dictates how the net proceeds of a sale will be split i.e. after the sale costs and after the mortgage has been redeemed.
The deed of trust formula has to work whether you sell tomorrow, in 5yrs time or in 25yrs time when the mortgage has been paid off.

getmore4less

The financial part of the deed is the easy bit.
Although many fail to get it right.
how do overpayments work.
how does maintenance get paid
etc.

The deed should also cover what will happen if events mean a change is needed.

eg. death, wanting to split, children....

rules for buyout and sale are not that easy.
if on moves out who pays should lodger replace etc.