Deed / declaration of trust - unequal deposit and unequal contribution to bills

c1995

Long time reader, me and my partner have had an offer accepted 295k on a flat to buy together and inevitably the conveyancer will be asking how the ownership of the house will be structured. 

Unmarried, no intentions of getting married soon, no kids and not being considered, long term 6 year + relationship and have been renting for 3 years. I am the main earner, providing all of the deposit 50k. Currently my partner works part time (30hrs/week) to enable them to focus on developing their music into something that may generate money. We split rent and bills 70:30 with me paying the 70% share, I'm happy for this to continue with a mortgage as it makes him happy and I want his music to succeed. 

We are happy and have no intentions of splitting but in the remote possibility that we did, what sort of deed of trust would be fair? I initially thought that protecting my deposit, so getting 50k return on sale then splitting profits 50:50. But if I am paying 70% of the mortgage is this fair on me?

There is no telling how long this arrangement will last at the moment, it has been 1 year, we initially agreed at 2 years before him going back work full time if the music doesn't turn an income. Even if he went back to full time the bills would probably be 60:40 as he wouldn't be able to afford to do 50:50 and maintain the lifestyle that we enjoy now (travelling which I pay the lions share of, eating out etc.) On the flip side he may go on to earn more than me if his music succeeds or he gets a different job.

My other idea was my deposit being 16.95% of the purchase price = 83.05% mortgage, 70% of this I would pay = 58.135%. Add this to my deposit = 75.085% ownership, 75% : 25% for arguments sake as tenants in common. But this assumes I continue to pay 70:30 for the next 35 years and a lot can happen in that time. I would also feel guilty suggesting this as we are equals in our relationship and me earning more does not mean I have a better standard of living - we eat, drink and do the same things.

Honestly, typing this out has made me feel petty, we're in this together and we're a good team. I think its wise to protect my deposit but then go 50:50 on any proceeds after a sale. Open to any further opinions.

lika_86

What's fair really depends on how you both feel about it.

I'd be inclined to go 50/50, either with or without providing for you to get your deposit back from the equity. Whilst you say this is from your savings, unless some of this is inheritance or a gift then presumably the reason you've been able to accumulate at least part of it is because you share your life and 30% of the bills with your partner?

In the 15 years I've been with my now husband our finances have fluctuated as to who earns more, first him, then me, then him, now me. From moving in together we've always structured our finances so we have the same amount available to spend on ourselves each month. We're a team and in it for the long term, so it doesn't really matter to us who pays more into the house (of course being married probably means accepting things will be relatively evenly split, I hope we'd have felt the same even if we hadn't got married and had split). 

turnitround

c1995 said:

Long time reader, me and my partner have had an offer accepted 295k on a flat to buy together and inevitably the conveyancer will be asking how the ownership of the house will be structured. 

Unmarried, no intentions of getting married soon, no kids and not being considered, long term 6 year + relationship and have been renting for 3 years. I am the main earner, providing all of the deposit 50k. Currently my partner works part time (30hrs/week) to enable them to focus on developing their music into something that may generate money. We split rent and bills 70:30 with me paying the 70% share, I'm happy for this to continue with a mortgage as it makes him happy and I want his music to succeed. 

We are happy and have no intentions of splitting but in the remote possibility that we did, what sort of deed of trust would be fair? I initially thought that protecting my deposit, so getting 50k return on sale then splitting profits 50:50. But if I am paying 70% of the mortgage is this fair on me?

There is no telling how long this arrangement will last at the moment, it has been 1 year, we initially agreed at 2 years before him going back work full time if the music doesn't turn an income. Even if he went back to full time the bills would probably be 60:40 as he wouldn't be able to afford to do 50:50 and maintain the lifestyle that we enjoy now (travelling which I pay the lions share of, eating out etc.) On the flip side he may go on to earn more than me if his music succeeds or he gets a different job.

My other idea was my deposit being 16.95% of the purchase price = 83.05% mortgage, 70% of this I would pay = 58.135%. Add this to my deposit = 75.085% ownership, 75% : 25% for arguments sake as tenants in common. But this assumes I continue to pay 70:30 for the next 35 years and a lot can happen in that time. I would also feel guilty suggesting this as we are equals in our relationship and me earning more does not mean I have a better standard of living - we eat, drink and do the same things.

Honestly, typing this out has made me feel petty, we're in this together and we're a good team. I think its wise to protect my deposit but then go 50:50 on any proceeds after a sale. Open to any further opinions.

I would rethink the last highlighted part. No wonder he is happy.

Bigphil1474

OP, my partner bought our current house and I moved in a couple of years later. They had bought the house with 1/3 mortgage, 1/3 their own money, and 1/3 borrowed from a relative. When I moved in we agreed to re-mortgage and pay off the borrowed from a relative amount. Give or take a bit, we agreed that they would retain their deposit value above anything else, and any of the profit would be split 50/50 going forwards. Financially that was to my benefit though as we could have done it as a %, but on the other hand I paid more of the bills including the mortgage so we were both happy with it and 28 years on we are now selling and just using the whole house value for a new house.

I'd say either you have a 50k charge on the property, or 17% (so that your investment grows along with the property), and any gained equity after that is split 50/50. You are right to consider these things, because if you do split up a few years down the line, there could be all sorts of legal disputes over it. Hopefully not. On the flip side, if his music takes off, he could always pay half of your deposit value to you and then the house would be equally owned.