Money Moral Dilemma: I put in a much bigger deposit - but should we split the property equally?

MSE_Kelvin

This week's MoneySaver who wants advice asks...

My partner and I are looking to buy our first home together. I'm putting in a 40% deposit and they are putting in 5% but they want to split the ownership 50/50 once we've bought. I think that'd be unfair - and have suggested we split it 60/40 in my favour, with the proviso that we both arrange our wills so ownership would transfer to the other if one of us were to die (we're not married). Am I being unreasonable?

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jenmaybee

I would suggest adding a stipulation to the deeds that if you split you get back your individual contributions 1st then split any remaining proceeds 50 50. Will you be paying an equal share of the remaining mortgage as that would change my advice?

eao

Have you not got your maths wrong?
40%+5% = 45% leaving 55% to split evenly ie 27.5% each, 
so 40% + 27.5% = 67.5% for you
and 5% + 27.5% = 32.5% for your partner.
Simple!

gloriouslyhappy

40% deposit is 2/5 of the property value - no you shouldn’t split it 50/50 after you’ve bought. That’s assuming you’ll be splitting the monthly payments equally. They’re having a bit of a laugh if they’re insisting, and I’d be rethinking the purchase. The sensible thing is to get legal advice and a properly drawn up contract reflecting each other’s initial contribution and outlining the terms of the payments.. 

teetkac

No, I don't think you should split 50/50. You could do two things:

1. Have an agreement drawn up that upon sale or split you get your 40% back and she gets her 5% and you could split the remainder 50/50. Or

2. Split it proportionally right from the start you 67.5% and her 32.5% (see a comment further up for the math rather than writing it out again for you).

Personally, I'd only split the whole property value 50/50 if you'd be willing to hand over your money if you split up. 

rosieposie777

If you do one thing- please get a deed of trust written up. 
A deed of trust should also be specific and detail who paid what deposit and what share they hold. 

Best case scenario you live happily ever after, worse case scenario you go seperate ways and they will become entitled to 50% of the value of the house (after bank is repaid their share) if a DOT is not completed.
When you have to start over it’s very hard. Unfortunately those that bring less monetary wise have more to gain… I am talking from experience and the fallout is a super expensive fail otherwise. 

DEED. OF. TRUST.

neilmorgan

Assuming this is a personal not business relationship I think you should either rent or pay the whole deposit and buy the house in your name only. You clearly aren't in a committed relationship if you have to ask the question.

I paid all the deposit on our house and we bought it in joint names. 
We started off with separate bank accounts but only because that's what we had. We didn't feel the need to faff about getting them set as joint accounts until we thought about if one of us died. ALL the bills including the mortgage came out of my account and all the treats came out of theirs

I think I must be one of the lucky ones because we were so sure of each other when we decided to commit to each other.

We've tried to ensure that as much as possible is in joint names now with Bank accounts, bills etc. or al least got both of us on with one as the bill payer and the other as a person authorised to manage the accounts.
  

gothvixen

I don't go along with the smugness of anyone who thinks this isn't a committed relationship, or that being "so sure of each other" is a guarantee of anything. There's no need for such statements, they really are just about showing off and are begging for the fall that follows such pride. I believe in fairness. The ownership, and any proceeds on sale, should be split according to contribution. It would be easy enough to calculate once any final profit or loss is taken into account. To contribute 1/9th of the deposit then wish for 50% ownership is unfair and unacceptable, and would have me thinking twice about that person and their immense sense of entitlement. Offering a 60-40 split is immensely generous.

Eulaliam

Deposit is a one off payment to get the house where you both going to live. You should put it in writing (legally) how much each of you contributed to deposit so in case you split up this can be given back. 

As to the other share of the house as long you’re both paying 50/50 for the mortgage then this should be divided equally. 

Alternative is for your partner to pay slightly more for the mortgage to make up for the deposit until you’re even and paid 50/50 for deposit.( of course you’d get that money by saving £100 per month).

For example, if your partner pays £100 more and you pay £100 less for however long, to eventually, make her share of deposit even with yours or she saves up to give you the cash instead. 

Groom

It certainly doesn't sound a fair split to me considering that the percentage is so different. As others have said if the house has to be sold you should get back 40% and your partner 5% then the remaining 55% should be split equally, providing that the mortgage payments and bills have also been split that way. 

newkitchenfund

teetkac said:

No, I don't think you should split 50/50. You could do two things:

1. Have an agreement drawn up that upon sale or split you get your 40% back and she gets her 5% and you could split the remainder 50/50. Or

2. Split it proportionally right from the start you 67.5% and her 32.5% (see a comment further up for the math rather than writing it out again for you).

Personally, I'd only split the whole property value 50/50 if you'd be willing to hand over your money if you split up. 

I'm not sure why you're assuming that the partner is 'she', as nowhere does the post mention their genders - it could easily be the other way about, or it could be a male gay couple.