AIBU to advise my daughter that she'd be daft to not put her name on house deeds?

[User197634]

My DD (20) is planning on buying a house with her bf of 2 years. He has been given a lump sum buy his parents to put down on a house, and my DD mentioned that it would only be his name on the deeds, even though she'll be sharing the bills.

I've advised her that, yes by all means her bf should have a contract drawn up to protect the money he's putting in should they split, but I still believe she should insist that her name goes on the deeds too.

I think she thinks that I'm over thinking things, but I want her protected too. Any advice appreciated

YADNBU

It's simple, he protects his deposit, the remainder of the house is split 50:50 assuming they are both contributing to mortgage and or upkeep.
Each will need their own lawyer to draw up the contract and register interests at companies house. Any lender will need to satisfy themselves that both have rights to live in the house should a repossession arise. If your DD lives at home and you have household legal included in your home insurance policy, she may be able to obtain initial advice and help to arrange a lawyer if you dont have one.

Even if there is no mortgage, if she contributes to the upkeep of the house, she has a claim to a portion of the property. To evidence this she would need to catalogue every penny spent on the upkeep of the house and every minute she spends on this too. Far easier to put on place a legal agreement to start with imo...

I think she should ask to go on the deeds and for a declaration of trust. That way, he can protect his deposit 60k, and they can agree to a future equity split.

Realistically, I think your daughter is very silly to pay 50:50 of a mortgage, upkeep and repairs of a property she has no interest in.

It needs to be a joint mortgage application or her name will not appear on the deeds. She needs to contribute and he needs to make sure his contribution to the deposit is ring fenced. Anything else leaves her vulnerable and without rights.

If she is going to pay half the mortgage then the mortgage (and the house) should be in both their names. It sounds as if his parents are providing a deposit. The contract can be drawn up with them as tenants in common and the percentage adjusted to reflect his deposit giving him a bigger share of it.

My friend's daughter bought with her boyfriend a couple of years ago - though they had both saved a deposit so they had equal shares. The relationship broke up and the house has been sold - fortunately with a price increase so they have both walked away with their deposits intact.

She should stay off the deeds and protect her first time buyer status.

I don't think it's fair on her boyfriend, or his parents, if her name were to go on the deeds.

Yes, she should pay her share of living expenses including bills. But don't pay towards the mortgage.

Her name needs to go on the deeds if she's paying half the mortgage.

Ringfence the £60k and the rest of the equity in the house gets split.

Bloody hell. It’s not complicated. He can ring fence his deposit but they should both be on the deeds if the mortgage is in joint names or if she is paying half. There is absolutely no way she should be paying half the mortgage and bills and NOT be on the deeds. I did this with my then bf (now DH). He paid the deposit but we needed both our salaries for the mortgage, hence I was on the deeds. As it happens, he didn’t ring fence his deposit either, even though I told him to!
Decades later, we are gifting a significant sum to DD to buy her first house, with her DH. That deposit will absolutely be ringfenced but her DH will also be on the deeds, because he will be paying half of the mortgage.

Yes that's what its called! That's what we did (we were not married and my deposit share was significantly more) thankfully never had to use it but our solicitor sorted it all out for us.

BOUGHT!!! Not brought

If it's a joint mortgage application, then her name will obviously be on it. Have you got a mortgage yourself, OP, or is this all new to you?

This. If she is not contributing to the deposit or the mortgage, why on earth should she be on the deeds?

If she is on the mortgage and the bank considers her income when calculating the loan details, then they are buying a house together and she should be on the deeds. To my knowledge it’s actually not possible to be on the mortgage but not the deeds. They need to seek legal advice for a fair way to protect his deposit.

The easier thing to do given her age and lack of deposit is not to include her on the mortgage or deeds, let him buy the house solely in his name, and have her pay him rent and part of the bills to live in his house like she would be doing anyway.

OP has said that her DD will be paying half the mortgage and bills and for the upkeep/maintenance of the house.

But, considering she's planning to get a joint mortgage, I've advised her that if this is the case she should also go on the deeds, obviously protecting her bf's money.

She will have to be on the deeds if she is on the mortgage, the bank will not allow it otherwise.

Totally agree. This and “draws” instead of “drawers” really get me!

Many years ago when my BF moved into my house, he paid half of all bills (not mortgage) and paid several hundred pounds a month into a savings account in his name only. He could have bought his own property if he wished. When we were ready, 6 years later, we bought a bigger house together and used the cash he had saved.

it might be easy to think ‘oh well, she’d be paying rent anyway so it’s all dead money’ however, several posters have rightly pointed out the loss of first time buyer status which seems an important point to me.

He needs to protect not the deposit, but the percentage of the house related to the deposit

Given she is not contributing to the deposit they should put something in writing to protect the boyfriend’s deposit IMO

In that case they need a joint mortgage which will automatically mean she has to be on the deeds. I would expect the deposit and the percentage of any resulting increase in value relating to it to be ring fenced by the boyfriend. Personally, I wouldn’t advise my son to cohabit with a girlfriend under these circumstances unless it was as a serious enough relationship to be considering marriage. There’s too much at stake for both sides.

They're only 20 and unmarried, FFS.

Think about your own relationship status when you were 20 - I was in a very lust-filled but actually pretty unsuitable, yet fun, relationship with a guy who really wouldn't have met my needs long term. I loved him with all my heart, but it wouldn't have been the right time to ever think about making a long term, financial commitment to each other. 20 is such a fluid time of flux where you're learning about yourself and what you want, and where you want it to happen, and what you want to do with yourselves.

He should absolutely buy the house and she can contribute to bills. It will be cheap living for her and in the meantime she can save hard to build up her own assets in the future.

She shouldn’t be paying half the mortgage if she gets nothing back. I think it’s fair to either

1. pay half and ring-fence the deposit percentage as equity if they come to sell and have a clear view on what would happen re negative equity.

2. (my preferred for her age and stage). Keep finances separate. His property is his and she continues to 50% of shared bills and not the mortgage. Possibly an argument for a contribution towards the interest part of the mortgage but absolutely no capital payments unless she has something to show for it.

I did something similar to 2 when I moved in with my boyfriend- now husband. I paid a nominal rent to cover bills and saved hard so I was in a position to contribute equity when we brought together.

When I moved in with DH it was his house and I just paid him whatever I'd been paying in rent before. We did this for a few years (I moved in after wed only been dating 9 months due to my house lease ending) and one we know it was serious I asked for my name on the mortgage and we got a declaration of trust to protect his investment.
After that it was 50/50.
I'd suggest either paying a nominal 'rent' or sorting the decoration of trust and a joint mortgage.

I mean of course if she is legally on the mortgage she has to be on the deed. Otherwise she has a debt but no asset.

Many lenders don’t allow someone to be on the deeds unless they’re also on the mortgage, because it complicates repossession rights if the mortgage defaults.

ETA: Sorry OP just seen your update!

https://forums.moneysavingexpert.com/discussion/5763258/can-i-go-on-the-deeds-but-not-on-the-mortgage