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Thomas
Thomas, Solicitor
Category: Property Law
Satisfied Customers: 7602
Experience:  UK solicitor holding an England and Wales practising Certificate.
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Hi I am planning to buy a house with help of another person.

Resolved Question:

Hi

I am planning to buy a house with help of another person. She helps with 20% deposit while I am contributing for 80%. I would like the house to be in Joint names but the shares assigned proportionally to the fact that I will be the only person paying the mortgage. I plan to sell the house in 5 years times. IF this is the scenario what would be the best setup for the house deeds?

pls adv

Marco
Submitted: 3 years ago.
Category: Property Law
Expert:  Thomas replied 3 years ago.
Hi Marco,

Thanks for your question.

Is the contributor of the 20% of the deposit also applying jointly with you for the mortgage?

Tom
Customer: replied 3 years ago.

Hi


 


sorry, I forgot to mention it, no


 


Marco

Expert:  Thomas replied 3 years ago.

Hi Marco

Thank you for your question and patience, I’m Tom and I’ll try to help you.

If your contributing has not joined you in applying for a mortgage with your mortgage lender then she cannot go on the registered title with you. This is because a lender will only consent to the persons applying for the mortgage going on the registered title.

So, if you want the friend to also go on the title then you would have to speak to your lender about this. They will require her/you to reapply together, most likely.

If you are happy to go on the registered title solely in your own name and your friend is also have with this then the option open to both of you is to execute a declaration of trust, which is a deed sworn by you both in which you specify how the proceeds of sale of the property (ie. when it is eventually sold) are to be divided. This could take account of your large deposit by either specifying that you should receive this amount first and dividing the remaining equity equally (or as a percentage proportion) or it could simply stated that you receive x% and you boyfriend receives y%.

The declaration can then be registered as a restriction or a notice against the registered legal title to the property that you are buying so that your friend would receive notice when you sell the property so she can then collect her share of the money in accordance with the declaration of trust that you execute.

Your solicitor acting on your behalf in the purchase would take your instructions as to the declaration of trust and then arrange your execution of it.


My goal is to provide you with a good service. If you feel you have received anything less, please reply back as I am happy to address follow-up issues specifically relating to your question.


Kind regards,


Tom
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