Monthly contributions

[NewGirl1990]

Me and my partner are in the process of buying a house together. It’s a new build, we’ve paid the £500 reservation fee, with my parent’s assistance, and the property will be built and ready to move into December/January, current situation pending. The majority of the deposit for the house is being provided by my parents, partner has a HTB ISA with £1,900 which will also be contributed. The money to do up the house, put the floors in etc, approximately £10,000 will be coming from myself solely. It is not my intention to get him to a sign any kind of deed of trust with regards to the significant amount I’m initially contributing. (Please don’t tear me apart for this!) My AIBU is that we’ve been discussing how bills will be paid, we initially discussed a complete 50/50 split, however he has recently taken a new job, which his after tax take home works out at approximately a few hundred more than mine. In terms of personal bills we’re both in the exact same position, i.e. no credit cards, car payments etc. Knowing that he is going to be taking home the additional income my thought is that he should pay in the additional income and I should pay less so that each month we both have the same amount of “spending” money from our wages. So for example if we were both originally paying £500 each it would now be split £400(me) and £600(him). This is the first time that either of us have lived together and so have never been in the position to have this conversation so unsure really how to broach with him the fact that I know think our contribution to bills should be different. I’d appreciate any advice anyone has!!
Oh, my AIBU would be;
Yes split bills equally / No it should be based on income.
Apologies for the very long post, thank you in advance.

Posted too soon -

And go and rent somewhere together for 12 months. Give living together a try, make sure you're going to get along, and then look at buying a house.

I would put your plans on hold until the situation around Corona Virus has stabilised.

No way in this world would I be considering making such a crucial financial investment when neither of you knows if you will have financial security, given the state of the economy.

The most worrying aspect of your post is that you are entering into a financial agreement with your partner but unable to speak honestly about contributions to the additional improvements and monthly bills. If you are unable to have that dialogue then you are putting yourself in a vulnerable position over the long term.

I'd also be concerned that he isn't volunteering to discuss the disparity between incomes and is leaving it hanging unresolved. Does it mean he's going to be able to tuck the money away into his own savings as a nice cushion, while allowing you to pay a more significant amount of your earnings?

Yes it’s our intention to get married, we decided purchasing the house first is the priority however.

If you intend to get married and want to prioritise financing the house purchase, then at least get the contributions to the house formalised by your solicitor.

Whatever you do OP keep your own bank account and put household money into a separate joint account with your DP.

I was raised to be completely financially independent of anyone (and this was in a home with no financial abuse - just parents with good financial sense). So it always makes me feel really uncomfortable when I read on here oh you must have a joint account and all salaries are paid into it. You earned the money, you keep/save it.

When children come along then the proportion going into the joint account increases but never let anyone take your financial independence away from you

I did this with now dh. I put the deposit down on our first house and didn’t ring fence it. He earned slightly more at the time and we agreed that our money would be completely shared. In some ways it was naive but I felt like it was the right start to us living together. It’s worked out very much in my favour as dh went on to be a high earner and we’ve continued to share everything.

He’s basically putting in nothing towards this house. I would have another think about this.

Things can sneak up. I found myself paying for most of the shopping, kids clothes, and the fuel bills were going up, insurance etc ( me), but the mortgage and council tax weren't (him). We're currently renegotiating.

As the majority appear to feel we should split equally then I’ll leave it as it is.

No, the majority seem to feel you need to protect your capital contributions, and only then pay equally.

We reserved the house before the current corona virus situation but again I am aware that everything is currently up in the air. In terms of our jobs, partner is classed as a key worker and my job is safe, so we’re not overly concerned that this current climate will impact our financial position in terms of employment. I appreciate he’s not contributing to the deposit of the house but as explained previously his role didn’t allow him to save a substantial amount, he was training/studying and as I said the majority of the money to do up the house came from inheritance. In terms of bank accounts, we have opened a joint account and the intention is that each month we both pay in a set amount to cover all household bills and then the remainder is in our own accounts to spend how we please. Again, thank you everyone for your input it’s much appreciated.

Walk away not for all the reasons that others have said. If it wasn’t a new build and you could move in quickly that’s one thing
But new builds are roughly 20 percent overpriced to start with.
So if you buy / commit now and the price drops which is highly likely you could be committed to a house that you can no longer get a mortgage on .as it’s no longer worth what you agreed to pay and mortgage companies will definitely be doing a revalue before they hand over a penny next year
But you still have to pay the deposit fees as that’s what you contracted to do .
This happened in the 2008 crash and property developers were ruthless about taking people to court to get the money owed
Which means if you don’t pay then you end up with a CCJ which means you won’t be able to buy for years
Honestly you have the cash . Someone with cash in your position this time next year will be in an excellent position

I can’t believe your parents wouldn’t insist on the funds being used for the house to be protected. I’d have driven them to the solicitors office myself if I thought they were going to make such a huge poor financial decision.

The bills should be 50/50 regardless of salary. Living together is meant to be a partnership where you share the house and bills not leave to one person.

I would also agree with the separate accounts, but with a joint account for bills.

Walk away from this house purchase now. Prices are going to drop a lot after this pandemic. You'll kick yourself further down the line if you don't.

mortgage companies will definitely be doing a revalue before they hand over a penny next year

A really good point from a really good post by @Itsjustmee. This is already happening, and new mortgages with LTV above 60% are affected.

That £10k cash could put you in a good position in 12-18 months’ time. As for your jobs being safe - I’m not saying they’re not safe right now but we’re in for the mother of all recessions and who knows how it will pan out.

I’ll speak with our mortgage advisor tomorrow regarding the possibilities that have been highlighted and whether they think we’ll be better holding off, especially given that we won’t be moving in until potentially next year anyway it may be more financially beneficial to hold off. For the people who have reiterated the need for a deed of trust, as I said I’ll speak with my parents and partner regarding this.

@NiteFlights I only know about the mortgage companies doing a revalue especially in cases like this because one of my friends got caught in the 2008 recession where they bought off plan and thought they could sell when built and make a good profit but the new build dropped by about
30k plus from the valuation and now could only get around a much lower amount from the mortgage company
The developers insisted that the price agreed was the price agreed and my friend lost a considerable deposit of around 20k and have never been able to get back on the housing ladder since

I voted yabu, based on the fact that you are not protecting your investment!!

If you have come on here to ask what's reasonable first, before discussing it with the man you've willingly handed 10k over to, then there's something out of whack.

NewGirl I would definitely take independent advice. If your mortgage advisor is working for the developers they would have a massive interest in you carrying on with the purchase . And even if they aren’t they would still have a big interest in getting you to carry on .
Write out a list of questions you want to ask and why .
Knowledge is power . Look up what I mentioned about the price dropping but your locked into handing over the deposit .
Also what happens if you cant get a mortgage for the price agreed
Even if they say they will extend the mortgage offer i. case of delays they won’t give you a mortgage on a house worth less than the value . You will be expected to come up with the difference which could be tens of thousands and thousands of pounds .
He won’t be able to gloss over that fact
And read any contracts properly
At the moment you have only committed a few hundred quid
Don’t lose everything

Get something written up, and perhaps even seek legal advice. Over £10k isn't an amount of money you wanna lose. If he is worth it, he will sign without any fuss.

If you don't get anything signed for whatever reason. A few years before you get married? Are you engaged? Speed that up aasp, relationships break down in a matter of days. You never know what will happen between now and then.

Put in writing everything that you each put into the house purchase, including anything paid by parents, anything bought by HP, give your solicitor a copy to write up an agreement that if you were to split up these are ringfenced to be given back to the original party. That way you are both protected & both know where you stand should the worst happen.

Have you spoken to him about this at all?
I’m not sure he would be reasonable to state he wants you to pay an equal share of the bills while simultaneously not paying an equal amount towards the house that he will be fortunate enough to jointly own with you.
He would really need to pick a position - either exactly equal contributions (put the purchase off until he can save up enough to equal you, or downgrade your purchase so that neither has to put as much in the pot) or go for equitable contributions. Not fair for him to have it both ways.
I’m sure if you’ve picked a good man he will be able to see this.