To not split a substantial house deposit should we seperate?

(18 Posts)
miggles33 Sat 09-Jul-16 16:00:10

I am buying a house with my long term partner. We have a baby together. Until I had a baby we both worked and split finances 50/50. We rented and have never had much money and so this was simple. I am at home with my baby and haven't decided when to start working again. My partner pays for bills and rent. I have some savings so contribute a bit. We are buying a house on the basis I am inheriting a deposit from a relative. The inheritance will cover 40% of house purchase cost. My partner will not contribute to this deposit. At the moment he will pay the mortgage but we will change this as I begin to earn again. We are both fine with this set up. However should we seperate I do not feel I could loose 50% of this substantial deposit as it has been saved and given to me by my grandparents. Aibu to protect most of it legally in case we sell the house? Wwyd? We are talking near 100k. Thanks for any advicesmile

lcoc2015 Sat 09-Jul-16 16:06:17

I am in the same position. Yes make a provision that the 100k is protected (i.e. in the event of a sale is paid out first to you whether there is positive or negative equity built up in the house). My solicitor has also suggested that if there is positive equity built up in the house that the proportion of the deposit of the house is also taken out first as this is the "return" on your deposit investment.
So say you put in 100k, purchase price 100k and the house sells for 300k. Then you get back 100k plus 50% of the positive equity first. The remainder of the positive equity is split equally.

Mouikey Sat 09-Jul-16 16:12:31

We did this with our house purchase and money from PiL - got a solicitor to draw up a contract in the event we ever separate. Very simple cost £100 or so and gave everyone piece of mind!

branofthemist Sat 09-Jul-16 16:15:06

If I were you I would be protecting my money. However, if I were him, I would have it reflect the fact that he will be paying the mortgage by himself for a while. A bit more difficult if you don't know how long that will be.

If for example you have more children and don't work for 10 years, he should get something from the house sale in the event of a split. No idea how you would work that out though.

RandomMess Sat 09-Jul-16 16:15:51

Either do it as a fixed sum or as the percentage that your deposit is worth of the purchase price - that is ring fenced, then any increase in equity is split 50/50 perhaps?

Certainly a very sensible thing to do to cover for all eventualities.

Tworingsandamicrowave Sat 09-Jul-16 16:27:37

You also need to protect your investment in the house for your child. If, God forbid, anything happens to you, your DP may well, at some point, start a new family and your child's portion could go to the new family. Horrible to think about but it happens.

Mondrian Sat 09-Jul-16 16:28:17

RandomMess is spot on, aim to protect your 40% and not the 100k.

Lighteningirll Sat 09-Jul-16 16:40:23

Hmm I am going to disagree if he's paying the mortgage I think the fair outcome if there is a split is mortgage cleared, you get £100k then fifty fifty on the rest.

lcoc2015 Sat 09-Jul-16 16:53:26

The only thing id say lighteninggirl is that while he is "paying" the mortgage, that she is essentially paying for it too as she is working unpaid in the house looking after the child(ren) and probably majority of the housework!

Inertia Sat 09-Jul-16 17:04:41

Absolutely do get a legal agreement drawn up.

Lighteninggirl- the only reason he is initially paying the mortgage is because the OP is doing the childcare. She could always charge nanny rates for looking after his child, and then pay the mortgage too.

Lighteningirll Sat 09-Jul-16 17:20:18

Yes that's why the house value is shared fifty fifty you are both contributing equally. Being lucky enough to have the initial £100,000 and keeping it protected is great but all benefits accruing from it should be shared as you are a partnership neither of your contributions are worth more than the others.

MatildaTheCat Sat 09-Jul-16 17:23:25

Get legal advice.

Creampastry Sat 09-Jul-16 18:13:27

Get legal advice to get your share protected. Very easy.

andantecantabile Sat 09-Jul-16 18:22:07

We did this, it's a deed of trust. It cost about an extra £100 ish on top of the conveyancing fees. Our deposit equalled about 20% of the purchase price, and in the event of anything happening x% of that 20% would go to me and y% would go to DP.

lcoc2015 Sat 09-Jul-16 18:40:18

Fair point lighteninggirl - its the generous way to look at it.

miggles33 Sat 09-Jul-16 19:20:20

Thanks for the advice. I wasn't sure if I was being unreasonable. I prefer the option of protecting the 100k and then splitting any equity 50/50. My partner has more of a romantic view that everything should be equal and therefore if we seperate we each get 50% of everything. He believes that you should put your all into a relationship and that includes finances. He is fine with paying the mortgage so does act this way with his own income. I just wish we both had an equal deposit so it wasn't a concern.

AlfrescoBalconyWanker Sat 09-Jul-16 19:31:13

My partner has more of a romantic view that everything should be equal and therefore if we seperate we each get 50% of everything

Which is fine in theory but you are taking a hit financially on your career by staying at home to look after your child.

Hissy Sat 09-Jul-16 20:58:32

Deed of trust. Do not buy a house without it.

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