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  • FIRST POST
    • IrritableFTB
    • By IrritableFTB 3rd Aug 18, 2:32 PM
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    IrritableFTB
    My Parents providing deposit, house in Partners name
    • #1
    • 3rd Aug 18, 2:32 PM
    My Parents providing deposit, house in Partners name 3rd Aug 18 at 2:32 PM
    Good Afternoon!

    Me and my partner are currently in the process of buying a house, we're due to sign contracts next week but we've hit a sticking point:

    Basically, the deposit for the house is from my parents, but the house and mortgage is in my partners name, due to me being a naughty (or stupid) boy with credit cards in the past. We've both agreed to split the monthly mortgage payments 50/50

    My parents are fine with this being a gift, however want some assurances that should things go belly up between me and my Significant Other (hope for the best, prepare for the worst) that I can get out what I (and they) have put in. Just to clarify, they're fine with the deposit being a gift and DO NOT want that money back, they just want to see my back covered (such a lucky boy)

    Is there anything that can be done, we've looked into declarations of trust but this seems to be a dead end...
Page 1
    • IrritableFTB
    • By IrritableFTB 3rd Aug 18, 2:34 PM
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    IrritableFTB
    • #2
    • 3rd Aug 18, 2:34 PM
    • #2
    • 3rd Aug 18, 2:34 PM
    I'm also fully aware that the first paragraph is grammatically incorrect, I'm not buying a house or signing any contract so please don't get pernickety
    • kingstreet
    • By kingstreet 3rd Aug 18, 2:56 PM
    • 34,239 Posts
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    kingstreet
    • #3
    • 3rd Aug 18, 2:56 PM
    • #3
    • 3rd Aug 18, 2:56 PM
    Anything which tries to "secure" the gift is going to undermine the declaration which says its a gift and no interest will be taken.

    I don't know how the parents will achieve their objective and the lender options for such a case will be limited.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • getmore4less
    • By getmore4less 3rd Aug 18, 3:16 PM
    • 33,267 Posts
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    getmore4less
    • #4
    • 3rd Aug 18, 3:16 PM
    • #4
    • 3rd Aug 18, 3:16 PM
    They could gift it to you and then with a joint interest you could protect your contribution being on deeds and mortgage.
    • Mojisola
    • By Mojisola 3rd Aug 18, 3:24 PM
    • 29,967 Posts
    • 77,011 Thanks
    Mojisola
    • #5
    • 3rd Aug 18, 3:24 PM
    • #5
    • 3rd Aug 18, 3:24 PM
    Basically, the deposit for the house is from my parents, but the house and mortgage is in my partners name

    We've both agreed to split the monthly mortgage payments 50/50
    Originally posted by IrritableFTB
    You'll need an agreement between you both as to what happens if you split up.

    The value of the deposit could go to you before you split any other equity in the house.
    • YHM
    • By YHM 3rd Aug 18, 3:26 PM
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    YHM
    • #6
    • 3rd Aug 18, 3:26 PM
    • #6
    • 3rd Aug 18, 3:26 PM
    Just because you are splitting the monthly payments 50 / 50 doesn't mean that the equity needs to be split in the same one.

    Look into whether it would be more appropriate for you to own the property as 'Tenants in Common'. This will protect the deposit you have put in
    I am a Mortgage Broker.

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice
    • kingstreet
    • By kingstreet 3rd Aug 18, 3:28 PM
    • 34,239 Posts
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    kingstreet
    • #7
    • 3rd Aug 18, 3:28 PM
    • #7
    • 3rd Aug 18, 3:28 PM
    The OP says no joint mortgage/purchase option due to adverse. Are others seeing something I'm missing?
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • sal_III
    • By sal_III 3rd Aug 18, 4:20 PM
    • 651 Posts
    • 663 Thanks
    sal_III
    • #8
    • 3rd Aug 18, 4:20 PM
    • #8
    • 3rd Aug 18, 4:20 PM
    Might be possible if you go for 2 names on the deed, 1 name on the mortgage and deed of trust. But AFAIK only HSBC is happy with that mortgage arrangement.
    • IrritableFTB
    • By IrritableFTB 3rd Aug 18, 4:27 PM
    • 8 Posts
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    IrritableFTB
    • #9
    • 3rd Aug 18, 4:27 PM
    • #9
    • 3rd Aug 18, 4:27 PM
    Anything which tries to "secure" the gift is going to undermine the declaration which says its a gift and no interest will be taken.

    I don't know how the parents will achieve their objective and the lender options for such a case will be limited.
    Originally posted by kingstreet
    Cool, its not attempting to 'secure the gift', the gift is exactly that, a gift. More attempting to secure 50% of a (potential) 25 year investment.

    Having spoken to our conveyancer, he's said a Declaration of Trust isn't something HE could do, as it would be a conflict of interest between himself and the money grabbers, but an external party could.
    • IrritableFTB
    • By IrritableFTB 3rd Aug 18, 4:32 PM
    • 8 Posts
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    IrritableFTB
    Might be possible if you go for 2 names on the deed, 1 name on the mortgage and deed of trust. But AFAIK only HSBC is happy with that mortgage arrangement.
    Originally posted by sal_III
    HSBC you say... Thats handy!
    • kingstreet
    • By kingstreet 3rd Aug 18, 4:44 PM
    • 34,239 Posts
    • 18,582 Thanks
    kingstreet
    Might be possible if you go for 2 names on the deed, 1 name on the mortgage and deed of trust. But AFAIK only HSBC is happy with that mortgage arrangement.
    Originally posted by sal_III
    Gifted deposit from non-relative of the applicant?
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • philip1988
    • By philip1988 3rd Aug 18, 5:25 PM
    • 149 Posts
    • 67 Thanks
    philip1988
    That's all very interesting because I potentially might be gifting the deposit to my daughter who is looking to buy a house with her partner.

    Like the OP I don't want the money back but want to protect the money for my daughter if the worst happens.


    Thinking out aloud, would the mortgage company allow a second charge on the property to the value of the deposit to be paid from any available equity AFTER the mortgage has been repaid?



    Many thanks
    • ACG
    • By ACG 3rd Aug 18, 5:34 PM
    • 17,658 Posts
    • 9,452 Thanks
    ACG
    It is not a true gift if there are strings attached.
    You are going to struggle with this.

    Have you thought about finding a specialist lender who will accept your adverse? Rates are pretty reasonable now a days on adverse Mortgage - or at least can be.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • getmore4less
    • By getmore4less 3rd Aug 18, 6:00 PM
    • 33,267 Posts
    • 20,089 Thanks
    getmore4less
    Bottom line if you want to protect a beneficial interest have one.

    Even that can be be messy to sort out with assets like an house as beneficial interest are not easy to liquidate.
    (even harder if there are commercial lenders)

    Gifts cannot be protected they are not gifts if they could.
    • philip1988
    • By philip1988 3rd Aug 18, 6:24 PM
    • 149 Posts
    • 67 Thanks
    philip1988
    Thanks for the replies. I can cross that idea off my list then.


    All I am trying to do is protect my daughters interests rather than looking to have a stake in their house



    May be they should go down the Tenants in Common idea suggested by YHM then
    • IrritableFTB
    • By IrritableFTB 6th Aug 18, 9:53 AM
    • 8 Posts
    • 0 Thanks
    IrritableFTB
    Looks like we'll just have to get wed! Things seem a whole load easier once you have a ring on your finger.

    Thanks for your help guys, much appreciated
    • Exotoxin
    • By Exotoxin 6th Aug 18, 10:54 AM
    • 1 Posts
    • 1 Thanks
    Exotoxin
    You need something like a "pre-nup" but without necessarily actually getting married at present. Although they don't have absolute legal force, they can certainly be taken into account by a judge if there is a dispute if you separate, just as they can be on divorce, especially if they are freely and willingly entered into by both parties. You just want it to say that you would get the first 25000 and then any remaining equity would be split between you in the ratio of your mortgage payments.
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