Rent from partner - what is reasonable?

[Olivia11]

My DP and I are planning to move in together in September. His preference would have been for me to leave my flat (which I own) and to rent a house together but we have agreed that initially he will move into my flat and we will reassess after 6 months. I think this makes sense for both of us as it gives us flexibility if things go wrong between us (which I hope they won't!) but it was really my decision.

We have not yet had a discussion about how finances will work when he moves in. Obviously I am expecting that we will split gas/electricity/increased council tax. But I don't really know what to suggest on my fixed bills and on rent. I don't really mind if he pays me or not - I am comfortably off and my costs won't increase as a result of him moving in. I quite like the fact that my flat is mine and I can see that maybe he would resent contributing to my mortgage when it wasn't his choice to live in my flat. On the other hand, it doesn't seem quite right that I would pay all of our living costs, particularly given that he earns considerably more than me. Whilst I don't need the money, it would of course be helpful - occasionally he wants to have extravagant meals out etc., which I cannot comfortably afford (sometimes I rein him in and sometimes I accept his offers to pay). Would it be reasonable to ask him to contribute about half market rate? This is a lot less than he is paying in rent at the moment and would cover about a quarter of my mortgage each month. Or should I just leave it and assume that if things do work out we'll share finances anyway and if they don't then I am lucky to be secure in my flat and not have to move etc.?

I do of course appreciate that we are both very fortunate and that this is a nice problem to have but I would genuinely welcome views on what is reasonable here. I'm conscious this sounds a bit glass half empty - I do think things will work out between us but, having seen my DM go through a terrible divorce and suffer financially, I just want to make sure that I have thought about things in advance.

I was in this situation OP but the other way around - my boyfriend had bought a house and I would be living with him, it was his deposit, his mortgage, his name on the deeds, I would effectively be a lodger.

We set up a joint account and paid in equal amounts, so effectively split all household bills 50:50. I then paid him £250 per month in rent, which was 100% of his monthly mortgage payments and I did that for about 3 years until the mortgage was paid off. The reason the mortgage was low and paid off quickly was down to his hard work saving over the years, so I was happy to pay the fully amount as it was still extremely cheap considering I got to live in a nice 3 bed house in a nice area and have input when it was refurbished before we moved in.

I don't think it would be unreasonable for you to ask for half of your monthly mortgage payments or an appropriate amount related to his share if you rented elsewhere.

If he's paying rent (half the mortgage) then he's paying off YOUR asset.)

Well yes but not all of the mortgage payments are straight capital. There will be a substantial interest element. And the vast majority of monies paid will be interest for a considerable number of years. So even if this went to court, he doesn't get to 'keep' the full value of what he puts in.

Forgot to say, on the point about mortgage payments and a landlord/tenant situation arising, I had to sign a piece of paper basically saying I had no legal right to the property and that the arrangement could be terminated at any time - presume that's to prevent this situation arising.

I have DH half of the mortgage, it was far less than market rent so was a huge saving for me and a little extra for him.

We still giggle about it now we are old and married and he has our huge Mortgage to pay on his own 😂😭

You have to tell your mortgage company that he is moving in and they will want him to sign a declaration that he won't claim an equitable interest in your property which will protect them and you.

If you take advantage of him now by getting him to pay your mortgage and not giving him a stake in the house, do you really think he'll share his income (higher than yours) with you in 6 months time? You'll be on here moaning that he still wants to split everything 50/50 so he has a bigger amount left over for himself. Either way is fine, but you can't have it both ways. Either you share everything (his high income and you putting his name on your deeds), or you keep everything separate (meaning you keep your house but he keeps his high income). You can't keep your house AND expect to get your hands on his high income.

Thank you to everyone who has suggested that he puts aside the amount he is saving in rent for a future deposit - it's not something I had thought of but I think that will work well for us and is what I am planning to suggest. Thank you also to those who have mentioned my mortgage provider will need him to sign a form saying he has no rights to my house - I wasn't aware of this but will check and arrange for this if necessary and will also check out the site linked to.

DowagerCuntess, mummyoflittledragon, drinkingtea - I agree that renting would be ideal in terms of being more equal, having a new flat, making it ours etc. etc. (WonderLime, I absolutely do want it to feel like his home). If he was really against living at my flat I would do it but it does put me in a bit of a precarious financial position if things go wrong - it doesn't make financial sense to sell my flat yet so I would have to rent it out, pay tax on that etc. And I couldn't afford for it to be unoccupied for too long. That's why we've agreed to reassess once we have a better idea of how living together is going.

Savelli - market rent and my mortgage are almost exactly the same. When I say charge him half market rent I suppose I actually mean a quarter of market rent (I was thinking half of what he would be paying if we were renting/ had bought the flat together).

Somerville - those are all good questions. I am comfortable with his attitude to money though. He hasn't bought here because it's not his home country - it all fits in to the (much bigger and more difficult!) question of where we'll live long term.

Harshbuttrue1980 - I absolutely do not expect us to share income in 6 months time; I am expecting we will share income when we are married and have children, which is a few years away still (by which point I expect I will have sold my home and it will form part of the deposit for our shared home). Who knows who will be the higher earner then.

It's interesting how many different views there are on what is fair in this scenario!

You can charge him whatever you feel comfortable with. I would assume 50/50% on bills and then some sort of rent would be in order.

There is so much really bad legal advice given here!

This is really important as he will have a future claim on your home if you split up.

He won't have a future claim on your house, ffs! He's not on the mortgage and not on the deeds.

If you start charging him rent and things don't work out, he can argue that a landlord/tenant relationship agrees and you could have trouble removing him from your property. And as others have correctly pointed out, he could have grounds to argue that he has a stake in the house.

No this won't happen! If you live in someone's house with them you're a lodger, not a tenant, and your rights are very limited.

He's your partner, not your tenant. When making the decision to move in, imo you make the decision to pool your resources and deal with everything as a unit, including household bills etc.

I wouldn't necessarily get joint accounts just yet if I were you, based on the tone of your OP, but certainly have a 'pot' for household expenditure for mortgage, bills, food and any other necessities and both contribute equally to it, otherwise, again based on the tone of the OP, it could breed resentment.

"He won't have a future claim on your house, ffs! He's not on the mortgage and not on the deeds."

This is utterly incorrect. The fact a proportion (equity) of the OPs home is hers prior to him moving in, is the legal 'starting point' not the end. Plenty of case law 10 years down the co-habiting line, giving interest in the property ownership to said romantic 'lodgers', utterly irrespective if names are on deeds or mortgages.

Ill repeat my link OP, and do seek independant legal advice.

www.advicenow.org.uk/living-together

No this won't happen! If you live in someone's house with them you're a lodger, not a tenant, and your rights are very limited.

Okay - landlord/lodger agreement exists then. However, she would still need to give notice (so, for example, if he were to cheat, OP would still need to give periodic notice (assuming that a fixed term arrangement hadn't been put into place) and can't just kick him out). That would mean living with him until a 'reasonable notice period' has been provided.

He won't have a future claim on your house, ffs! He's not on the mortgage and not on the deeds

As Caroline stated above, you are incorrect and he can stake a claim on increase in market rate over the years he has been paying towards the property.

As stated, the safest thing for the OP in this situation would be to split bills and suggest DP put money into a savings account for their future.

I moved in with DP and gave him £400 a month towards bills and his mortgage. The cost elsewhere would have been closer to £800. Both of us benefitted and managed to save cash towards a bigger home.

it doesn't make financial sense to sell my flat yet so I would have to rent it out, pay tax on that etc. And I couldn't afford for it to be unoccupied for too long

Based on this and also the fact that he earns more than you - i think the only fair thing is to pay towards joint bills in proportion to your incomes.
Did you stop to think that if you were paying 50/50 in a rental property YOU would be more financially worse off than him?

You're testing out living together - you're not married so no need to pool all your incomes and consider everything to be 50/50.

There's loads of threads on MN about women who end up with none or very little disposal income because they pay 50/50 despite the disparity in incomes....or they end up trapped and financially screwed because they didn't want to do 'unromantic' things like protect their pre-marital assets, or ringfence the deposit they put towards the house, or ensure they were on the deeds/mortgage of new house, or keep a separate account and only transfer bill monies to joint account, or keep half the joint savings in their own name/account.

Does he want to move back to his home country at some point - such as if gets married/has children?
If you would be happy to move abroad then you need to research and safeguard yourself against the worst case scenario....e.g, if your dc are born over there/live there x amount of time it would be nigh on impossible for you and the dc to move back to where you have family support.

Do what you want but always make sure YOU have taken steps to safeguard your assets/financial security just in case the worst case scenario should happen.

i'd re-phrase the 'rent' as 'wear and tear expenses'..........

He should at least pay half the market rate to you because nobody lives rent free. Alternatively he should put that amount in to a joint savings account to be spent by both of you on your next joint home.

Why not ask him if he is willing to split all the bills on how much you earn, and you pay this into a bills account.
So if you earn 40% of the money and he earns 60% you would split all bills that way, but both of you get to keep the rest of your money and do what you want with it. but if one gets a pay rise than the other would benefit.
Bills of £1000 a month would mean 400/600 split.
This way you can keep an updated list of the Bills and adjust accordingly. So many people on here find it is money that causes the most problems in a relationship,
Agreeing it before hand stops all this,

I'd charge him wither half of the mortgage interest (the capital repayments have nothing to do with him) or half the rent payable on a place if you rented together, whichever is the lesser.

Also half of council tax and utilities.

As pps have said, be careful he doesn't end up with an interest in the property. Best way to do this is to set out in writing that he's paying as rent only, and won't acquire an interest in it by making the payments.

I live in DP' house which he owns. I pay half the bills, contribute to home improvements and maintenance on an as-agreed-per-job basis, and we have a joint account we both pay into equally for groceries and other joint living costs.

I don't pay any 'rent' (ie any part of his mortgage). We don't plan on necessarily getting married ever, so simpler if his assets remain his without grey area.

Admittedly he earns quite a bit more than me at the moment even with paying the mortgage payment. It's not logical for me to pay anything as it would noticeably and negatively impact my spending power while boosting his which is already higher.

I can see it's a tougher problem if it was the other way round in terms of mortgage payer having lower spending power than non mortgage payer.

My DP pays £500 per month which covers rent, utilities, council tax, car, and groceries ( though he buys the odd thing) . My mortgage is 1200 so don't expect him to pay it off 50/50 but nor should he live rent free especially as he rents out his house