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Original poster

help! tenants in common or joint tenants?

47 replies

nicknamegame · 10/06/2013 15:23

Myself and my DP are about to buy our first home together. He has provided the deposit. We will both be paying towards the mortgage although he will pay a lot more than me. Both our names will be on it. I have a child (not his) and we are stuck on the above question. When completing forms for conveyancing they have asked us whether we want to be joint tenants or tenants in common. Neither of us really know what it means and to be honest, from my own perspective, I want to know if I will there's anything I might end up doing which could risk mine and my DD's security. DP is lovely and I trust him- but I would just like to know which method is best in these circumstances. I would imagine he will want to protect his deposit which he has been kind enough to put down without question, but that aside, I don't want me and dd to end up with nothing should we split.

Thoughts?

TIA! Grin

OP posts:
Original poster
nicknamegame · 10/06/2013 15:30

Forgot to add, DP wants me to sign a fees of trust in relation to his deposit, as this is what his solicitor and the bank advised him. Does this all sound ok?

OP posts:
Original poster
nicknamegame · 10/06/2013 15:30

*Deed of trust- not fees!

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Choccywoccydodah · 10/06/2013 15:30

I'd speak to a solicitor and ask them to explain. When my now dh bought his first house about 15 years ago, we had a Deed of Trust drawn up as he put down 25% which was totally unheard of back then and had spent 7 years from leaving school working his arse off and saving to buy a house, and I came along, only just 18 and could potentially have walked away with half.
I know it's not a nice thing to think about (if you were to split up), but you both need to know where you stand 100% and really only a solicitor can give the correct advice for your personal circumstance.

Choccywoccydodah · 10/06/2013 15:31

X post, deed of trust perfect Smile

Merrow · 10/06/2013 15:32

I just did an exam on this!

To protect his deposit it has to be tenants in common - which basically means you have a percentage split. But joint tenants is better for you, since you haven't contributed to the deposit and will be paying less on the mortgage (if you did split in the future, you would get 50%*).

The other main difference is what happens on death - if it's tenants in common, then the person's share is left according to the will; if it's joint tenants, it goes to the other person, even if the will has something wildly different.

*actually, I've just seen the trust aspect. I have no idea about that. My exam was a bit more basic...

Original poster
nicknamegame · 10/06/2013 15:41

Thanks both! He wants to go with the 'tenants in common option, which I guess means he will be protecting his share in case anything happens to either of us. The deed of trust relates to his deposit only I think.

The way we currently share our bills is that he pays the rent and I pay the utilities ( he earns a LOT more than me). If we continue this when we buy this new house, does this mean that he will 'paying all of the mortgage' and therefore I'm not contributing at all? Would that be bad for me in the long term if we split?

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FreckledLeopard · 10/06/2013 15:45

Will you be tenants in common in equal shares? Or will you be allocated a portion of the total house (i.e. you hold 40%, he holds 60%)?

If you're going to hold the property as tenants in common, then it doesn't matter who pays what bills - you're both the owners, regardless of how bills are paid.

Original poster
nicknamegame · 10/06/2013 15:49

Thanks freckles, that's a bit of a relief...I think I thought that if he could prove that he paid all the mortgage then I would end up with nothing.

In terms of the tenants in common (in relation to the deposit) we haven't got as far as discussing the percentage spilt. I don't even know how to go about discussing this with him to be honest, what would I suggest is a reasonable split?

I

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FreckledLeopard · 10/06/2013 15:55

Well, for example, you could be tenants in common in equal shares, or in different proportions. And you can have, separately, a Declaration of Trust relating to the deposit, stating that if you split/sell up etc, he will be entitled to the amount he put in, or whatever you decide mutually.

So, for example, if he puts in £50,000 for deposit, the Declaration of Trust states that this money is 'his' if you split etc. Then you have to decide how you want to hold the house - whether in equal shares or in another proportion.

Merrow · 10/06/2013 16:07

The tenants in common is for the property as a whole - it's not for the deposit. You could calculate the total cost of bills + mortgage payment per month and if you are contributing 35% towards this, then you could maybe suggest a split of 65%/35%, with the deposit protected by the Declaration of Trust.

Original poster
nicknamegame · 10/06/2013 16:26

Thanks everyone. I appreciate the help.

Ok now I understand the deed of trust. I totally get that he would want to protect his deposit if we split.

In terms what percentage we own the house after that though- would it be unreasonable of me to say we should own it 50-50?

I know he will be paying more than me, he earns a very high salary however and I could never match his contribution. I kind of feel though that if we had have bought a more modest property and one that was well within my capabilities of contributing to, I would have been an equal tenant then, if that makes sense? DP ( for want of a better expression) has higher fashion needs than me and insisted on the one that we are about to buy. I feel on the backfoot as a result and less 'equal' than him now.

Also- and i know this isn't his problem, but if we split, he could dust himself down nicely and not lose the house. I would be the one who would have to move out and move away to another area (away from my dd's school,) to be able to afford housing.

I've been bitten like this before- and very badly I should add. I'm just keen to avoid it happening again, but wonder if I'm just thinking out loud rather than coming up with anything sensible!

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Merrow · 10/06/2013 16:45

No, it wouldn't be unreasonable - lots of people do that. My partner and I have a joint tenancy, because we wanted that feeling of equal, despite the fact we contribute different amounts because of salary differences.

On the flipside, I can see why wanting a split to reflect different financial contributions is logical.

Sounds like you need to sit down and talk about it!

Original poster
nicknamegame · 10/06/2013 18:02

Thanks merrow, guess a chat is needed tonight!

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TuTuTilly · 10/06/2013 19:42

Have you both got wills drawn up?

Original poster
nicknamegame · 10/06/2013 20:10

No- is that the next step?

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mumblechum1 · 10/06/2013 21:36

The reason that other posters are suggesting that you should have a will drawn up is to protect both of you. If you own the property as tenants in common, and don't have wills, then when the first of you dies, their next of kin (in your DP's case probably his parents) would inherit their share and the house would have to be sold to accommodate that.

If you both make wills, you can give one another either a life interest (so that the survivor of you can stay in the house until they too die or marry someone else), or a right to reside, which means that the survivor can stay in the house for a specified number of years. At the end of that time (the trust period), the house would be sold and in your case presumably you'd want your share of the house to pass to your daughter. The will would also cover everything else, eg gifts to your partner and/or other people aside from the house.

I'm a professional will writer and have a paid for advert over on Mumsnet Classifieds (Small Businesses) titled "5* Will Writing Service Recommended by Mumsnetters" if you need any further info (no obligation).

Original poster
nicknamegame · 11/06/2013 09:18

Thanks mumble! We had a chat last night and agreed about doing a will so will look at your ad. DP is being a bit weird about it all...not sure why. Neither of us are especially comfortable talking about money as it is...but he's gone all strange on this and I can't get my head around it....:/

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fubbsy · 11/06/2013 11:15

In what way is dp being weird?

Buying a house together is a HUGE commitment. If you can't discuss the practicalities comfortably at this stage, it makes me wonder what might happen in the future. What if you have actual problems (financial, legal or otherwise) that need sorting out?

Choccywoccydodah · 11/06/2013 11:31

In what way is he weird? Like fubbsy said, a house is a massive commitment, moreso than marriage.
A house is not just a piece of paper.
We've got friends (male) that bought houses when they were 18, got a girlfriend, never had anything drawn up etc, and at almost 40 are still out of pocket compared to where they potentially should be financially.

I forgot to mention, when we had a deed of trust, after 5 years, we remortgaged and Dh took out his original deposit and the DoT was destroyed. That is another option perhaps? That way everything then was joint in the event of a split.

Xenia · 11/06/2013 13:15

As a higher earner....... my advice to him is (a) never marry you (b) as he is paying 75% of the mortgage say then he should have that as his share of the proceeds not 50/50 on a sale (3) wills, yes, but perhaps it would be fairer that you only receive what you put in if he dies - it is not as if you have given up work to support his children, instead he is paying for and housing another man's child

Advice to you is to marry and then you have more rights or why not do what many women do - get full time work and outearn the man and problem solved!

Original poster
nicknamegame · 11/06/2013 16:31

Lol@xenia

Some assumptions being made there! I earn 42k per year and work full time. Not a high earner but hardly being 'supported by DP either thank you very much!

And DP is not housing my child. What a cheek

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whiteandyellowiris · 11/06/2013 16:39

I wouldn't accept any less than 50/50 split

I guess its your call what your willing to accept

Original poster
nicknamegame · 11/06/2013 17:00

White- really? I thought with him paying the deposit that it wouldn't be equal. Last night he said he took advice from the mortgage people and conveyancer and they suggest a 60-40 split. He wants me to sign a deed of trust to that affect.

To those asking why he has gone weird. I don't actually know why- and I may even be reading into things, we've been under a lot of pressure lately (unrelated). He just kinda clams up and says he finds it uncomfortable to talk about money. My guess is that he is uncomfortable to be asking me to sign a deed of trust in the first place, but I understand why. I myself have been in a position before where I got screwed over and ended up with nothing so I get why we need to sign this...I think he feels bad though.

And coming back to Xenia- how do you mean 75%?
As it stands at the moment he pays our (hefty) rent but I pay all household bills and food, which total almost 900pcm. It's 50% less than the mortgage is, but swallows up a massive chunk of my salary. I also have my childcare to pay for on top of that.

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whiteandyellowiris · 11/06/2013 17:32

yes really.

I wouldn't make that sort of commitment to someone without there ultimate commitment back
even if I didn't have a dc
but you also have a child to protect here

the fact he is uncomfortable talking to you openly, is ringing alarm bells with me, I think you need a serious think about what you want to do

you could insist you will only move in with him, buying a house that you can be equal partners in, and getting somewhere less expensive...

also he said,
he took advice from the mortgage people and conveyancer and they suggest a 60-40 split
they don't give that sort of advice unless you ask for it.

I would personally never agree to a 60/40 split
your either in things together or your not in my book

good luck op
your going to need a frank chat about what you both want
I mean have you even talked about if either of you would like children together?

Original poster
nicknamegame · 11/06/2013 18:09

We have talked about kids...although not in great depth. Neither of us are planning more ( he doesn't have any)

I kind of think that we are only able to buy in the area we live because of him and that comes at a price I haven't paid. 60-40 doesn't sound unreasonable to me, although I agree it sounds off that he is being funny about it. I knew he was going to ask for advice from the conveyancer etc as when they sent us the forms about joint/tenants in common, neither of us knew what to sign, hence the fact that I ended up on here. It was me who told him to find out which of the two he wanted to sign. I didn't feel it was my position to insist that we are joint tenants, considering the deposit situation. When I got advice from here last night I talked to him about doing wills ASAP because under tenants in common (if I've understood it correctly) we could make each other homeless in effect if one of us died as the house would have to be sold to pay off the next of kin. With a child to consider, I felt it was important to sort wills straightaway and asked DP what he wanted to do ( as in, should we write wills to say the other can stay on etc) and he got really funny and and bit pissed off if I'm honest. More along the lines of 'yes I KNOW how wills work, thanks'

Not good, but not sure i should read into it either.

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