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

Both your dd and her bf need to get legal advise. Just getting advise from mummy on such a life changing decision just shows how young and inexperienced they are.

That's ridiculous. They are 20 not 16

As several pp have said - the bank won't loan her any money if she is not in the deeds. Otherwise what collateral is she putting up for her share of the loan?
If the mortgage is in her name, her name will be on the deeds.
The questions are -

1. Who suggested the mortgage would be in her name and she would make payments but not be on the deeds?
2. She mustn't pay into the mortgage if she is not on the deeds. She can still be a lodger or something and pay her way. But what she pays should be fair to get and not necessarily a proportion of the mortgage

What difference is it than paying a landlord? You can't expect to live in someones house for free.

Her bf is using his deposit to allow him to buy, he is entitled to the returns on his substantial investment.

Paying half the mortgage each is mainly paying off mortgage loan interest and minimal, if any, off the capital.

Perhaps they could agree if they both pay half the mortgage, whatever reduction there has been in the mortgage capital that year is halved and she gets it as a percentage of the current market value?

Depending on figures it would work out <1% a year.

What she pays to bills is not relevant we all need to pay to live day to day. If she pays substantial money towards home improvements any increase in equity (not just decorating) that could also be included.

That sounds fair. It is not reasonable to expect to benefit from someone else’s investment that early in the relationship.

If the mortgage is in both names and she is paying her share then she should be on the deeds, but his deposit should be protected via a declarationof trust. Myself and my DH bought a house together before we were married with a deposit I solely provided. But since then we've paid for everything split and the house is in both names. If we did split I would get my deposit back before splitting any remaining equity.
If he is buying the house and she is just going to live there then she shouldn't be paying towards the mortgage, just bills, then she can save towards her own place, or a joint place in future.

Apologies for not reading all the replies but I’m about to go out and wanted to tell you my daughter did in a similar situation.

A couple of years ago, she bought a house with her boyfriend of two years. As my daughter had owned her own house for four years ( she was older than your daughter and had worked very hard to afford her own house), her equity in the house paid for the down payment on the new house and then, like your daughter, all bills were split between them. Her partner was living a rented house but did have some savings which they used towards some alterations they wanted to do but my daughter contributed the most.

I think they are both on the deeds of the house but either way, the solicitor they used for the purchase set up a legal document to protect my daughter financial contribution, it means if they split up and sell the new house, she will get a certain amount before the proceeds are split between them.

Maybe this is something your daughter’s partner would consider, it would mean that his £60k is protected. I think most solicitors involved in the purchase when there is a joint mortgage would suggest this anyway.

In that case, the house and mortgage should be in joint names, but as tenants in common. They can have a deed of trust drawn that protects his deposit if they split up.

If he's canny, he'll have it drafted so that his deposit is protected as a proportion of the net proceeds of sale, so that the amount will increase as house prices rise.

A friend failed to do this when she used her £6k savings to pay a one-third deposit on an £18k house. She split with her partner decades later when the house was worth £180k, and her ex ended with not much less that half the equity, despite her having paid a third of the original purchase price and 50% of all mortgage payments.

The fact that she is going to be paying half the mortgage changes things substantially. It sounds like they're planning to buy a place he couldn't afford without her borrowing capacity. That means he should ringfence his deposit but she should be on the deeds. If he wants to be the sole owner then he needs to buy a place he can afford on his own.

Oops, crossed post with the person above who did exactly that!

TBF 60k isn't that much. I would let him pay the mortgage on it and you dd go half on bills. Fuck paying someone else's mortgage. If they split in 10 years she will get nothing. Absolutely nothing.

I think you should get this thread moved to legal as too many people on here are trying to give relationships advice rather than looking at the bigger picture.
We were in a similar situation only the other way round. DD had her substantial deposit (from us) ringfenced and then her partner (now husband) was on the deeds as they shared the mortgage.
Evidence of your DD’s contributions to the mortgage will protect her if things go tits up (which they might not). DH and I had a mortgage at 20 and have had 40 happy years 😊

If she pays to the mortgage and/or goes on the deeds, it's going to be so messy when they likely break up. 22 is so young to be tying herself down to such heavy financial commitments (and indeed one relationship!).

Would he be in a position to buy her out if they did split? It's easy to be swept away with the excitement and romance at the start, but got to think practically too.

Surely, if it is a joint mortgage, then of course she should be on the deeds, his deposit can be legally protected, but they jointly own the house. If they split up, he gets his deposit plus 50% of any equity.

It is possible for her to be on the mortgage without being on the deeds (though they will need a special type of mortgage, Joint buyer, sole proprietor to do this).

My now wife and I (both women) were basically in this same situation though she was not on the mortgage. Roughly 18 months into our relationship I bought a flat with help on the deposit from a family inheritance. She paid one third of the bills and mortgage (in proportion with our salaries) and we agreed in writing that she would have no claim over the flat. I benefited from her contributing to the mortgage which built up equity in the flat. She benefited from being able to save more as she paid much less as her contribution to the mortgage than if she’d been paying rent. Her contribution to bills was the same as in a rental.

For us it was all academic because we’re now married and have bought a house together, but I don’t think it’s fair for you to expect her to have a claim on the property if they break up (potentially forcing him to sell to buy her out even if the deposit is ring fenced). She’d have to pay to have somewhere to live either way and in most parts of the country, serving a mortgage is cheaper than renting an equivalent property.

You seem to be fixated on the house doubling in price and her missing out. What happens if the house goes into negative equity?

At 22, I bought a house with my boyfriend. A year later it was valued at 60% of the value of our mortgage.

Would you be happy with her taking on that debt at her age?

Ring fence his 60k (unless you have a similar amount to put in, OP?)
Add her to the deeds if she is also going on the mortgage.
Check what the penalty is if they have to sell early. She will be half responsible for this, and if they do not make a profit in the next two years or it goes into negative equity, the latter could be an issue.
Up to her really, they have been together for two years but living together is a different ballgame.
Maybe renting from him is a good idea if she wants a get-out clause herself. Owes him nothing, leaves with nothing.
She could be saving whatever she saves on cohabiting for her own contingency fund, should she ever need one.

My husband has all the mortgage and bills. I live here for free or is it free really because we are married. Why the young lady has to be fulfilling the role of a wife and paying for it on top of this

I bought a house with my partner in my mid 20's, I was in the position of your daughters partner and contributed all the deposit, I had a declaration of trust drawn up so if we sell the house the deposit will be returned to me and any remaining equity split equally as the morgage is joint and we have split everything between us. It has worked out as a good investment for us both as the house has increased in value significantly. It definitely puts your daughter in a bad position if she's not on the deeds, particularly if they decide to have children later on, it makes her very vulnerable if they separate.

They are either buying jointly together in which case she is on the mortgage and the deeds with him having a trust deed to protect his £60,000 contribution

OR/ he is buying in his sole name and she is merely a lodger who shares the bills and pays towards the mortgage by way of paying rent. Even half the mortgage may be less than she would pay to rent somewhere.

They need to decide between them on what basis they are buying.

You are the voice of reason and using knowledge we learn with age

She should absolutely not be “buying” a house with someone and paying the mortgage if not on the deeds

The boyfriend should absolutely get the the solicitor to draft an agreement that all parties sign prior to the house purchase being completed that ring fences the £60k he’s putting in

Both steps protect both parties

There is sometimes no telling them, but they will learn

I very much doubt any lender will want to loan a joint mortgage and only put one persons name on the deeds, in fact it's going to be pretty impossible to get a mortgage in this way.

the reason being - he loan is larger because they will take b0th incomes into account - so they want both parties to have a vested interest in the property, otherwise without her name on the deeds she can just stop paying her share of the loan and walk away - leaving him with the loan to pay and its not affordable as her income was included in the loan.Lenders won't want this

If she’s paying half the mortgage that should come with ownership right. Otherwise she should just pay some lower than market value rent.

Are they doing a joint mortgage application in both names? Then she will be a co-owner. If he's applying for a sole mortgage, then she's just his lodger even if she's paying him rent equivalent to half the mortgage.

If she's not applying for the mortgage, she won't be on the deeds.

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