Who should really own our house?

[Littlething]

I will appreciate some advice and fresh perspective on my situation please. Sorry if it is a bit long.
Me and my partner of 15 years (two dc, 11 and 8) are about to exchange on a house that we are buying with the money I inherited from my late parents. There will be a small mortgage, paid out of rental income on my flat in London. We moved to where we are now 2 years ago from London for his job. We were renting here while we were looking for a house to buy paying rent out of the income on my London flat. I have stopped working after my youngest was born, my dp has a good job (architect), that covers our bills. My parents gifted me the flat in London, so we lived rent/mortgage free and they gave us cash for holidays, new car etc, we would not be able to afford it otherwise. We spend rather carefully, shopping in H&M and Lidl but we like to entertain, go to the theatre and children have lots of hobbies. My partner has a flat in London that he bought before we met, he pays mortgage on it and rents it out, so mortgage is covered.
The house we are buying here is small and will need extension and loft conversion, it will be paid for with what’s left out of the money my parents left me. For context, we decided to buy a small house (in a not very ideal location) because it is all we can afford without selling mine or his flats and he is strongly against selling since “it is our pension”.
I agreed to put both our names on the title. I want to make it clear that he is a kind and loving person, he is my best friend and the children adore him. I do not want to upset him by spelling out that it is my money that we are spending on the purchase and renovation. However when I said the other day that I expect to have an upper hand when it comes to decisions to do with renovating (and maybe selling when the children are off to Uni) he got very upset. He feels that he will “pour all his energy, time and skills into the house and will be left with nothing”. He also said he feels his contribution to our finances is major because all his salary is spent every months, he provides for us and this needs to be recognised. AIBU to expect him to see it from my perspective?
Many thanks for reading and sharing what you think.

@HinchcliffeandMurgatroyd You may well be right, except that if the renovation budget is small relative to the house purchase price, and the mortgage is only to cover the value of the renovation, then the OPs income from the flat might be enough for her to take the mortgage in sole name.

The alternative if that does not work would be Tenants in Common with unequal shares, or a Deed of Trust, as per your suggestion.

@YankeeDad Would lenders accept rent in a separate property as income for a mortgage on an unrelated property?

I am not completely sure, but it is, after all, income, so I think they might if the separate property were unmortgaged and unencumbered, so long as the percentage of that income needed to service the mortgage were not excessive.

Even if they would not, though -- a separate option (which would have a higher interest rate but could still work) could be for OP to take out a buy-to-let type mortgage against the flat in order to use the money to pay for the renovations in the new house.

OP hasn’t been back
A professional legal perspective on the various options is useful as part of the decision making process, you don’t have to have it all worked out before seeking it

You've been with him 15 years and have two kids together. It should be his home as much as yours.

You got pregnant too quickly? You'd been together for 4 years?

Yes a prenuptial but the courts would look at everything including what each spouse contributed. If there is or is no prenuptial the courts can still look at what each party brought into the relationship and divide assets accordingly. A pre nuptial would be evidence of intention at outset. Look you clearly feel strongly about this so take the advice and go and see a solicitor. Both your interests should be looked at going forward in deciding how to own the house. You could just tell him you want this house in your name or else!!!

@CheesyColeslaw i totally agree with you. I also think if she’s that worried she ought to be able to have this conversation with him - openly. If not, strikes me there’s a lack of trust or fear in this relationship. It’s hard.

@YankeeDad @Dinoteeth @HinchcliffeandMurgatroyd

the mortgage lender would only solely use the rental income to cover a sole mortgage in OPs name if it was sufficient income to cover all the bills debts food and cost of living for OP, her children and running costs of both properties and the mortgage. It would also need to cover rental income gaps or voids ( some lenders discount the rental income by 25% or more to allow for times when she doesn’t have a tenant) and stress tests on the mortgage interest rate Therefore it would need to be one hell of an income to be able to cover all of this.

furthermore if the lender becomes aware that her partner will live there (which she has to disclose) then they will likely ask him to sign a deed of consent and postponement because they will recognise that he has a claim over the house regardless of whether he is on the mortgage or not and they will want to be able to evict him in the event of repossession.

they may also want proof he can service his own bills or they may include him as another dependent of OPs for her to support as they can’t normally physically check his income and outgoings if he isn’t a party due to GDPR.

@blubberyboo that would be prohibitive if you are right.

But, I was suggesting a buy to let mortgage secured against OPs flat (in which they are no longer living), not a mortgage on the main house, in order to get cash out from the flat. I would have thought that a BTL mortgage does not require the rental income on that property to cover all of the expenses of the borrower, but rather only the mortgage expense and other expenses related to that property. Since only the OP owns the rental flat, I would have thought that only the OPs name would need to be on that mortgage.

But maybe I am wrong about that. I have never taken out a BTL mortgage.

@YankeeDad

any mortgage is assessed based on the entire financial circumstances of the borrower no matter what collateral is held. So the affordability checks for the full household and allowance for stress tests and rental voids still apply. They wouldn’t simply look at the new mortgage payment against the rental income in isolation.

The only difference with securing it on the rental property rather than the new home is that they wouldn’t have to capture the partners interest in the property. However as someone noted many lenders wouldn’t be keen on using this property as collateral for the benefit of improving another property and they would also have a maximum loan to value they would go to.

many lenders wouldn’t be keen on using this property as collateral for the benefit of improving another property

How would they know?

@Blossomtoes

Well if it is a substantial renovation and a large cost they will ask to see quotes from the builder to see if walls are being knocked down or anything that could be a structural problem or anything that needs planning permission or building control approval. Lenders really don’t like you tearing on and doing things without them checking the statutory consents are there in case they need to repossess the house and sell it to someone else. They may also ask for the property to be valued taking account of the current value and a predicted value once the proposed work was finished.
Obviously the quotes and permissions would come in showing another address entirely, plus the mortgage valuation surveyor would be a bit puzzled

@Blossomtoes

Plus it is mortgage fraud to lie on a mortgage application.. not that you were suggesting such a thing

Blimey. You do know that after buying this house and spending your money on it, he will be able to walk away with a floosie (!) and take half of it, while you will have great difficulty to lay your hands on any of his flat. Before progressing, all of your properties need to be in your joint names, as joint tenants (check with solicitor, I think that's the best option). He could die, and leave his flat and half of your new house to his siblings or parents or anyone. You'd have a protracted, expensive fight on your hands. No matter how lovely he is today, things change, protect yourself, most of the investment is yours. Get advice. Before you exchange.

Don't put his name on a house bought mainly with your money, even if you do have a small mortgage, make sure you have an agreement drawn up that if you split he moves out, always protect your assets.

I am just having a bit of a wobble, it is a big deal to buy a house together and draw a mortgage together.

And yet it doesn't appear to have been a big deal to have two children with this man and to expect him to keep you all for eight years. I'm all for women being financially independent and protecting their futures etc, but I'm getting some really uncomfortable vibes from your posts, OH. You've clearly inherited your parents' skill at making and keeping money.

As others have said, it's as if you want to be financially risk-free when it comes to financial risk in your marriage. You expect him to be the one taking all the risk of being left out of pocket if you end the relationship. There needs to be equal jeopardy and more fairness. It sounds to me as if you've already got one foot out of the door.

If he's living rent and mortgage free in the house bought and renovated with YOUR inheritance money, then it should be in your name. He lived rent free for 2 years in London in the flat your parents gifted to you. He also benefitted from the new cars and holidays they provided. Have his parents done anything similar?
There's your answer.
Renting out the flat he owns in London only covers the mortgage on that property with nothing left over.
He must take into consideration the fact that you are doing a job ie: looking after the home and your children. That has to be worth something. That, plus the fact of him not having to pay rent or mortgage costs, nullifies the amount he will spend on bills and food for you and your share of the children's upkeep. You already receive about £140 pm child benefit.
Tread carefully. Get everything done legally and see a solicitor on your own so he doesn't have any influence over what you disclose.

@Pluvia
If I read the thread correctly, the OP only stopped work after the youngest was born. Not for the 8 years you've imagined.

@LoisLane66

but he won’t be living mortgage free! He will be living in a property which has a joint mortgage the size 0.7 times the value of his own flat which is also mortgaged I believe. He is being left with a lot of liability. He will be jointly and severally liable for the payments on it. It sounds like it’s a substantial mortgage and potentially not one OP could have secured herself with no earnings other than rent. She wants him to take out the mortgage so that she doesn’t have to spend all her inheritance. If she was doing that one could understand keeping it in her sole name but not if she is tying him into a big mortgage.
He is financially supporting both OP and the children and the upkeep of their properties through his salary and whilst she obtains a degree.
If her rental property has void periods or needs to have repairs and is out of action for renting then he will have to support the new mortgage entirely and the household.

it’s very muddied waters and certainly not clear cut that she should get to have him sign up to a mortgage while she keeps money in savings and then tell him he has no say.

@blubberyboo
I see. Thanks for the clarification. In her initial post the OP mentioned buying the house with her inheritance and using the rental income from her London flat on the extension and renovations.

I'd never merge my money with that of my OH no matter how much he earns. I like autonomy.

I put more money into our house by mules than my husband, but he has done lots of work on it that I couldn’t have done. We’re a team. So I never ring fences anything. It’s very much OUR house.

If you are a cash buyer and it's all your cash buying the house, then yes, in a technical sense, the house should be in your name only as your dp isn't putting any money towards it via deposit or mortgage repayments.

That said, dh and I have been together about as long as you have (but married), also with two primary age dc. I could absolutely not imagine being at this stage in our relationship and as a family where we wouldn't fully be partners in a house purchase. I put about £150K more into our house deposit than he did (though he is the higher earner). We are joint tenants. Because we're a family and it was a mutual decision to purchase the house.

I do get the value of ringfencing your money and protecting your assets, as you aren't married, but it just seems a bit odd. I would have been quite upset if the roles had been reversed and dh didn't trust me enough to share the property jointly just because he put more money towards buying it.

Yes, if he was my son I'd be concerned about what he's taking on. Speechless at the person who said that as his parents haven't given him millions he shouldn't expect his wife to treat him equally or even fairly...