Buying a home together with different financial situations ona

Jonathan_Kelvin

Tom99 wrote: »

Say you buy for £200k and you put down a 50K deposit.
You have a deed of trust which states that on the sale of the property you get the 1st 25% then you pay off the mortgage then you split the difference 50/50 (if you are paying the mortgage 50/50)

This seems like quite a fair way to do it, especially as it means that you get both the upside and the downside of a house price move.

If you do settle down to a long and happy partnership, perhaps with children later, then it could well make sense to revisit this, accepting that you are life partners at some point, and setting aside the differential ownership, as it could cause some resentment in decades to come, especially when there are so many other factors feeding in to the value, such as DIY, improvements, damage caused by children etc.

Jonathan_Kelvin

danlightbulb wrote: »

Dump him and find someone from a better social class.

Hopefully this is just a weak attempt at a joke, but social class and wealth are not at all the same thing. I think, from your posts, that you are likely a D or an E social class, and I’d remind you of Michael Carroll, same social class as you (or maybe one up) even when he was a multimillionaire.

AlexMac

I think that you've had the answer to

AsgardsPrincess wrote: »

... As I'm putting down basically my lifesavings I don't want to then own the house 50/50 as we aren't married ... Can you decide the home ownership % at the time when you write the contracts with the estate agent? ...

which is essentially; Yes, in that your solicitor (not the estate agent; as it's not their job to advise, they're not legally trained and their advice cannot be trusted, especially as they work for the seller, not you) can write appropriate documents, or even set it up so you own differential % shares in the house; i.e. not 50-50, from the start; you can always change the %s later... (Google "Joint Tenants" and "Tenants in Common)

But some of the other less constructive, or even troll-ish comments, above, are prompted by your comments that

AsgardsPrincess wrote: »

... I am good with money and I have saved a considerable amount ...My partner has not saved very much at all; the mortgage advisor was trying not to laugh... I don't want to then own the house 50/50 as we aren't married and it's not very fair on me if something happened (touchwood, but you have to be realistic...

which seems to almost invite relationship counselling?

People change, and only you can work out if the relationship is strong enough to last. You seem immensely sensible, so f you love him enough to consider marriage, I'm optimistic (although I didn't get it quite right myself; my 1st relationship only lasted 17 years. The second, however has already sustained for twice that, and looks like lasting til we snuff it!). So with the right legal advice, it seems reasonable to assume that it's safe for you to buy together. It would only be a financial disaster if you were forced to sell due to separation within, say 5 years...

However, the test of that might be whether the fiance is able to discuss this sensibly and rationally before you put your intentions to the solicitor? We had friends who weren't married but who had a 20+ year long relationship, owned property together but hadn't made a will (something I'd strongly advise you to do if you co-habit before marriage). They decided to write wills, but the solicitor kicked them out of her office when it became obvious that they hadn't sat down together to agree her instructionsprior, so couldn't agree a simple formula! In fact, they subsequently separated; maybe that was the catalyst!

So, chat it through- both of you might have to compromise; And check back here and let us know how it went, in, say 20 years!

kangoora

Originally Posted by danlightbulb
Dump him and find someone from a better social class.

Jonathan_Kelvin wrote: »

Hopefully this is just a weak attempt at a joke, but social class and wealth are not at all the same thing. I think, from your posts, that you are likely a D or an E social class, and I’d remind you of Michael Carroll, same social class as you (or maybe one up) even when he was a multimillionaire.

I doubt it was supposed to be a joke and certainly not even remotely funny if that was the the case - if not, then just an arrogant snob, ridiculing the 'lower classes'.

take your pick, an idiot who wouldn't know a joke if it bit them on the a*** or an arrogant snob.

AsgardsPrincess

Thank you to the helpful people for your answers, no thank you for the trolls.
Seems there's horrible people on every website on the Internet

Obviously I do intend to marry my fiance that is why I am his fiancee

Moneyminded

Just wanted to stop by and wish you luck with your future house purchase. It sounds like you have your head screwed on and have managed to save a good amount, congrats!

Find yourself a good solicitor/ conveyancer when you have found the house you want and your offer has been accepted, they will be able to draw up the paperwork to reflect your deposit contributions. If there is anything that you are confused about along the way just ask .

Wishing you all the best for your exciting year ahead

getmore4less

Before we start you have to include ALL costs that includes any fees SDLT, mortgage fees etc when establishing the starting point.

There are two basic ways to do this.

1. Get your deposit back
This is quite common and is the same as an interest free loan of 1/2 the difference in cash outlays at the start.

There is a flaw in this as most property purchase start out down due to the costs, this can be adjusted to make this fairer.

Also the one putting the money down gets no benefit from it.

2. equitable shares

The share of the property is based on the amount you put in as cash and the amount of debt you service.

You can do things like adjust the debt service to get the ownership 50:50

In a simple scenario of a £300k purchase £100k down by A and split the mortgage £100k each

A owns 66.6...% and B owns 33.3...% when sold that what they get from the total left before they pay off their share of the mortgage.

.......................................

The other issue you get is other costs like maintenance and improvements they should be done at the ownership level which is easy for 2. but with 1. it can increase the inequality for the person that put down the cash if they are paid out 50:50.


You have to consider the ongoing costs longer term where there is a financial inequality as one person may be able to afford something the other can't or does not want, for small stuff like a £100 redecorating it might not seem a big deal but £15k for the new kitchen might be a bigger problem.

[Deleted User]

I had the same situation with my OH when we bought and had a deed of trust drawn up to say I contributed xx to the deposit and would get this back should we split and sell.

We also both have wills to cover what happens if either of us dies, or if we both die.

If we get married eventually then I think we automatically become each others beneficiary but as we are not it was something we were advised to do by our solicitor.

My OH was also pretty rubbish with money before we bought but he's definitely gotten better over the past few years and even has savings now. I think that the responsibility of home ownership and having a mortgage will give most people the kick up the backside they need to be more sensible with their money.

Mojisola

Deleted_User wrote: »

We also both have wills to cover what happens if either of us dies, or if we both die.

If we get married eventually then I think we automatically become each others beneficiary

If you do marry, your current wills will be invalidated and you will need to make new ones.

If you don't make new wills after the marriage, the intestacy rules will be applied to your estates -
https://www.which.co.uk/money/wills-and-probate/probate/intestacy-rules-ay87y1u73pkk

Crashy_Time

Putting your "life savings" into an extremely illiquid asset like property at this time is probably quite risky IMO.