Protecting equity

[Freeyourmind]

Posted in money matters but posting again here. With DP for 8 years, house in my name, mortgage in my name (former family home from first marriage). Remortgaging now to do some home improvements so DP will be added to mortgage. Wanting to protect, ring fence so to speak, my equity to date. Will be done legally but is it a declaration of trust that I need? Is it a fairly straight forward thing?

Declaration of trust - that is something the conveyancer can do for you both. Work out whether you have a percentage of the value of the property (free of mortgage) before the remainder is shared (subject to mortgage) or you get the first £x of the proceeds of sale based on the current value of the equity.

Will he go in the deeds at the same time? Eg as a tenant in common or joint tenant?

Thank you for replying.

Ok so situation is property is worth £180k about to apply for joint mortgage for £110k. Mortgage lender said they would treat it as joint mortgage with equal share on deeds. Mortgage adviser says we might need to find a different lender if the declaration of trust doesn’t take care of it for me. I just need my original £70k ring fenced in some way.

So am thinking tenants in common would be better in this situation (is that the norm though - I’m not sure). But will Declaration of trust work with the way this lender wants to do it.

More information needed. If the property has £70k equity and is worth £180 presumably your mortgage is currently standing at £110k. So where are you getting the extra money from for the home improvements?

It's not down to the mortgage lender the shares you each own.

And yes - you hold as tenants in common in unequal shares.

Ah yes so current mortgage o/s is £90k, taking extra £20k for home improvements. DP also paying for some improvements from his own savings but is happy to do that, we’ll split the monthly repayments going forward.

Currently dealing with advisor through moneysupermarket, mortgage deal will be with Virgin money with free conveyancing (I‘m assuming I’ll have to pay extra for the declaration of trust). Would it be that conveyancer who will do all of this or will I instruct someone separately?

Guy doesn’t seem massively knowledgeable hence me asking here. So I’m asking for joint mortgage, tenants in common with unequal shares with declaration of trust?

So you are contributing property with £90k equity. You should get back the first 90k on sale. Or in the alternative you get back the first 50% of the proceeds of sale with the balance going firstly to repay the mortgage and secondly to be divided equally between you. Presumably after the works are done the property will be worth more. He presumably would want to get back what he put in from his savings.