Safeguarding deposit for son . Legal advice needed please.

[Cricketsandowls]

Posting for traffic here and need advice from people working in this area.
We are about to give our son a substantial sum for a deposit on a house with his partner. They have a child but are not married. My concern is what would happen if they split up in the future. Her parents are giving an equal amount , but in the event of a split I am concerned he may lose the deposit. Or would it be sold and split equally? I don’t know what the legal situation is and how we could ensure he doesn’t lose the money in the event they split up. Do we need to do anything to protect the money before we give it to him?

IANAL
I don't think there is anything you can do.

However as not married there are things each of them can do, namely in legal agreement regarding house ownership set out how much each has paid to deposit and % share of house ownership.

If they are not married and both sets of parents are gifting an equal deposit in the event of a break up the house would have to be sold or 1 buy the other out.

Yes, I assumed that would be the case .

OP, just get an appointment with a solicitor to check this out rather than posting on MN.

You will get good answers and stuff that doesn't compute so best to spend some money to get true legal advice.

Most relationships break up sooner or later - sad but true - so make sure you have all legal angles covered in any eventuality.

They can hold the house as tenants in common in whatever shares they like. That would protect the deposit somewhat. The conveyancing solicitor will be able to advise.

OP your primary concern should be that your grandchild has somewhere to live if his parents split up not whether your son gets a deposit back when his girlfriend is also putting in equal amount.

Amen.

That should be up to the child's parents to sort out

I agree. And that will be harder if OP adds all sorts of terms and conditions. Do it or don't do it, but don't use it to control their relationship.

They should buy the house as Tenants In Common (not Joint Tenants) with a deed which states what proportion of the house each owns. Their conveyancing solicitor can easily sort this out.

Absolutely..and with 50/50 care now the norm - their son will need to ensure his deposit is protected should he need to buy a home to house ther GC in the event of a split.

This is not the 1970s ! The mother is not the default parent .

That very much depends if the father is doing 50/50 currently. You can't just chuck that in at the time of split if one person has sacrificed their career and earning potential in the early years.

Your son and his girlfriend need to buy the house as tenants in common and to sign a cohabitation agreement drawn up by a family law solicitor.

The agreement will protect both of them, especially as both families are contributing equal amounts to the deposit.

As they have a child either could bring a housing claim under schedule 1 of the Children Act if they split up but a family solicitor will tell your son if that would be likely. For example, it would be unlikely if both earn similar amounts and could rehouse with a mortgage.

The only way both sets of parents could completely protect the deposit monies is providing a loan of the deposit monies rather than a giving it as a gift- but that means there are IHT issues as the loaned money still forms part of your estate.

I would suggest extreme care with recommending agreements etc and present it as protecting both your son and his partner and needing to be done at the same time as them both signing wills and sorting out life insurance. I am assuming that if either passed away the agreement is that the other would inherit the entire house - if so they need wills as they are unmarried.

I am assuming that if either passed away the agreement is that the other would inherit the entire house - if so they need wills as they are unmarried.

If the deposit is 'substantial' and thus the house is expensive, is tenants in common really the right way to go? If one partner died, the other might be liable for inheritance tax on the unowned part of the house.

This reply is why the son needs legal advice!

There is an inheritance issue for any cohabitee whether they own a share in a property as joint tenants or as tenants in common if their deceased partner owns assets over the IHT threshold.

Any potential IHT issue would be sorted by marriage ( spouse exemption ) but a prenup agreement is not as effective as a cohabitation agreement.

Ah, OK (sorting probate for a simpler case at the moment, hence the thought; but should have looked it up first).

My son does more childcare currently. There is such a lot to think about and I don’t know how to tactfully put all this to them without implying I don’t think their relationship will last!

Op, please tread carefully.
Unfortunately you may come across like you don't trust her which clearly you don't.

I do feel sometimes especially with first relationship, family there should be an element of trust.

Why haven't they got married? Do you think they will?
Why is he doing more child care.
Do they spilt all other chores right down the line?

*How old are they
*what are her parents doing to secure her deposit from your son.

Don't you care about your grandchild?

What a deliberately goady post ! If you can't offer any helpful advice, why bother posting ?

It is helpful for the grandchild
Who is a minor and not a adult.
Yes his security should be protected.

If they're not married and your son is doing 50/50 and they've both put in the same amount then there's really no issue here. Seriously, your involvement could make things a lot worse, you could concentrate instead on supporting their relationship to help them not split up. Particularly in the early years of parenthood.

I just want to protect my son’s deposit in case he needs it to move elsewhere if they split up. Of course I want their relationship to work! Of course I care about my grandchild having a roof over their head! I’m trying to be realistic. He earns most of the money but also does most of the childcare at the moment. She is a great mother but I worry about his future security if things go wrong. Her parents are very on the ball in terms of protecting her interests.

Well he should not marry.
That is what will protect his assets.

Hopefully though they stay happily together and this never becomes an issue.