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Buying together; to have and to hold

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So you’ve decided to take the leap and buy a home together. Of course you cannot wait to get the keys and move in! But there’s something you may wish to think about first; something that may make you squirm a little bit, but something that needs addressing nonetheless.

What if it all goes wrong?

Your first reaction may be ‘shush, we don’t want to talk about stuff like that! We’re buying a house, we’re very happy!’ But if you are buying a property with a partner or a friend, this is an important issue to discuss, and something your Conveyancer will bring to your attention.

Now it’s not all doom and gloom. There are simple and practical ways to pre-plan with the help of your Conveyancer, which will put the issue to rest both in legal terms and in your own minds.

Firstly, address whether you are going to purchase the property in your joint names. This way, you will eliminate issues of sharing the proceeds on sale, particularly where one party has contributed towards improving the property but is not named on the title deeds. Similarly, if one party is asked to leave the property and is not entitled to a legal or equitable share in the property.

Secondly, decide how you are going to hold the property jointly. There are two ways in which to do this:

  • Joint Tenants- you shall each own the whole of the property, and either party’s share shall pass to the other on death.
  • Tenants in Common- you can predetermine the shares you each hold. This may be based on your contributions towards the purchase, perhaps in the instance where one party is providing a larger cash injection, or perhaps one party is utilising the sale proceeds from their own property to fund the joint purchase.

In most circumstances, married couples of those in civil partnerships tend to opt to hold as joint tenants. Unmarried couples, friends, or those who have made uneven contributions often chose tenants in common. Where the contributions are unequal it is wise to make a supplemental document known as a Declaration of Trust.

A Declaration of Trust is a document that clearly outlines how much of the property you each own and how the value would be divided should you split up or sell the property. It is a legally binding document that contains the details of how much each has contributed and how much they will get if they sell.

Furthermore, if your deposit contributions are unequal and as are your contributions towards the household budget, you may wish to consider a ‘Cohabitation Agreement’, with the help of our Family Law Department.

Finally, it is essential that you consider the issue of Wills. Without a will there is no guarantee that your wishes will be carried out should you pass away. Fishers’ Wills and Probate Department would be happy to assist you with such an important issue. This is not something you necessarily have to organise during the well-known period of stress of moving home; it may be something you address once you have settled in.

This general advice will of course vary according to your personal circumstances. Although topics of death and separation are not often subjects we all wish to think or talk about, let alone at length, but we will guide you through this process in an open and compassionate manner so as not to look upon the subject so pessimistically.