Buying a house with my girlfriend

Karlwist0

I am buying a house with my girlfriend. She will put a massive deposit down and will be paying nothing towards the mortgage. I will be putting no deposit down and paying toward the mortgage every month. In the end she will have still paid 75% of the value. How do we make this fair in the event of a break up?

I want to make sure that neither of us lose out.

We have a solicitor to help us with the trust agreement but we are struggling to come to an agreement.

london21

Is she putting down a 75% deposit?

MWT

Karlwist0 said:

I will be putting no deposit down and paying toward the mortgage every month. In the end she will have still paid 75% of the value. How do we make this fair in the event of a break up?

If she is putting down 75% and there is a mortgage for 25% and you are paying 100% of the mortgage then it is easy.

If you sold the house the day you bought it, for the same as the purchase price, she gets 75% of the equity, the lender gets 25%, you get nothing.

If you sell it at some future date after the value has increased and you have paid down part of the mortgage, then she is due 75% of the sales price, and you get the remaining 25% less whatever it takes to clear the mortgage.

If the value has fallen the calculation is a little more complicated, but given the 75% deposit the value of the property is never likely to be lower than the balance on the mortgage so it still looks like this:

She gets 75% of the sale price, which may be less than she originally put in. You have to settle the outstanding balance on the mortgage using the remaining 25% of the sale price and if that is not enough you would have to add your own money to cover the shortfall.

fullofcold

Speak to your conveyancer about tenants in common

Karlwist0

london21 said:

Is she putting down a 75% deposit?

yeah that's right

Karlwist0

MWT said:

Karlwist0 said:

I will be putting no deposit down and paying toward the mortgage every month. In the end she will have still paid 75% of the value. How do we make this fair in the event of a break up?

If she is putting down 75% and there is a mortgage for 25% and you are paying 100% of the mortgage then it is easy.

If you sold the house the day you bought it, for the same as the purchase price, she gets 75% of the equity, the lender gets 25%, you get nothing.

If you sell it at some future date after the value has increased and you have paid down part of the mortgage, then she is due 75% of the sales price, and you get the remaining 25% less whatever it takes to clear the mortgage.

If the value has fallen the calculation is a little more complicated, but given the 75% deposit the value of the property is never likely to be lower than the balance on the mortgage so it still looks like this:

She gets 75% of the sale price, which may be less than she originally put in. You have to settle the outstanding balance on the mortgage using the remaining 25% of the sale price and if that is not enough you would have to add your own money to cover the shortfall.

So if it goes down in price, only I lose out?

Karlwist0

MWT said:

Karlwist0 said:

I will be putting no deposit down and paying toward the mortgage every month. In the end she will have still paid 75% of the value. How do we make this fair in the event of a break up?

If she is putting down 75% and there is a mortgage for 25% and you are paying 100% of the mortgage then it is easy.

If you sold the house the day you bought it, for the same as the purchase price, she gets 75% of the equity, the lender gets 25%, you get nothing.

If you sell it at some future date after the value has increased and you have paid down part of the mortgage, then she is due 75% of the sales price, and you get the remaining 25% less whatever it takes to clear the mortgage.

If the value has fallen the calculation is a little more complicated, but given the 75% deposit the value of the property is never likely to be lower than the balance on the mortgage so it still looks like this:

She gets 75% of the sale price, which may be less than she originally put in. You have to settle the outstanding balance on the mortgage using the remaining 25% of the sale price and if that is not enough you would have to add your own money to cover the shortfall.

Also, how does this work if we put 50% each into the maintenance? Does this affect the percentage we both get back or will it stay at 75%/25%?

It may just be me being terrible at maths which is causing the issue here. To me, it seems to keep it all equal she would have to pay 75% towards everything such as a new kitchen or whatever .