House deposit question
Discussion
Partyvan said:
Hi all,
I'll keep this as brief as possible.
Other half has £40k for a house deposit. My money is working harder in my business, so I don't want to put anything down.
How can we keep it a fair 50/50 split? There's 100% trust between us, but I'd like it to be legally bombproof out of principal.
My ideas:
A) She lends me £20k, with some legally binding agreement. We both put £20k into the house and have an equal share in it.
B) She puts £40k in, but I pay say 75% of the monthly mortgage payment until we're even
C) I convince her a 911 turbo is a better option than a house and you all back me up
Thanks in advance.
A might be the most straight forwardI'll keep this as brief as possible.
Other half has £40k for a house deposit. My money is working harder in my business, so I don't want to put anything down.
How can we keep it a fair 50/50 split? There's 100% trust between us, but I'd like it to be legally bombproof out of principal.
My ideas:
A) She lends me £20k, with some legally binding agreement. We both put £20k into the house and have an equal share in it.
B) She puts £40k in, but I pay say 75% of the monthly mortgage payment until we're even
C) I convince her a 911 turbo is a better option than a house and you all back me up
Thanks in advance.
B will take a long time to reach a point where you've actually paid of 20k of the mortgage principal
C let us know how that works out ;-)
Another option might be to have a deed of trust as tenants in common owning unequal shares of the property. For argument's sake:
House price: 400k
Her deposit: 40k
Your deposit: 0
Her share of property: 55%
Your share of property: 45%
She then 'owns' 220k (50% of the mortgaged amount, plus her deposit), you only 'own' 50% of the borrowed amount.
Of course the downside is she immediately 'owns' more debt, as well as the equity. There's more liability for her than you if house prices fall, even though she's taken all the risk.
I think the 'How can we keep it a fair 50/50 split?' is not really a valid question, the initial starting point is inherently unfair!
Surely just have an agreement drawn up that you ve put zero deposit in and shes put 40k in, then decide how you want to devide the bills up.
If your money is working harder in your business, id assume that sooner or later that business is going to help you both out financially so its ll all come good in the end.
If your money is working harder in your business, id assume that sooner or later that business is going to help you both out financially so its ll all come good in the end.
The easiest way does appear to be a properly documented £20k loan from her to you. Then you each put the same equity in the property and make the same mortgage payments, bills etc.
On top of the mortgage you pay her £x per month on the £20k loan (maybe £200 so as to get to zero over 8 years), with the option to make lump sums to clear the balance?
On top of the mortgage you pay her £x per month on the £20k loan (maybe £200 so as to get to zero over 8 years), with the option to make lump sums to clear the balance?
NickCQ said:
The easiest way does appear to be a properly documented £20k loan from her to you. Then you each put the same equity in the property and make the same mortgage payments, bills etc.
On top of the mortgage you pay her £x per month on the £20k loan (maybe £200 so as to get to zero over 8 years), with the option to make lump sums to clear the balance?
ThankyouOn top of the mortgage you pay her £x per month on the £20k loan (maybe £200 so as to get to zero over 8 years), with the option to make lump sums to clear the balance?
Could a solicitor draw up & witness that loan, and secure it on my equity in the house?
If there's 100% trust, do you need to do anything? Can't she just put the deposit in and you buy the house together?
With our first house, the misses put in most the deposit. We're in our second house now and I'm putting in a shed load to modernise it. Not once have we thought about having a deed or trust or similar.
With our first house, the misses put in most the deposit. We're in our second house now and I'm putting in a shed load to modernise it. Not once have we thought about having a deed or trust or similar.
OP - you need to think about the result you want (and intend) to achieve before working out how best to go about it.
Her lending you 20k and you then buying the house as joint tenants (or the equivalent) would potentially leave you in a different position further down the road than if she owns some greater percentage by dint of the 40k paid in at the outset.
That does not necessarily mean a worse one - all dependent of course on house price movements, the shares you agree, money you put in later etc etc...but certainly worth bearing in mind.
Her lending you 20k and you then buying the house as joint tenants (or the equivalent) would potentially leave you in a different position further down the road than if she owns some greater percentage by dint of the 40k paid in at the outset.
That does not necessarily mean a worse one - all dependent of course on house price movements, the shares you agree, money you put in later etc etc...but certainly worth bearing in mind.
mcg_ said:
If there's 100% trust, do you need to do anything? Can't she just put the deposit in and you buy the house together?
With our first house, the misses put in most the deposit. We're in our second house now and I'm putting in a shed load to modernise it. Not once have we thought about having a deed or trust or similar.
What if your relationship goes tits up, she decided she hates you and you’re not getting anything, essentially you’ll be stuffed With our first house, the misses put in most the deposit. We're in our second house now and I'm putting in a shed load to modernise it. Not once have we thought about having a deed or trust or similar.
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