Unequal home ownership - grateful for any advice!

[OnThisHarvestMoon]

My husband and I are thinking of buying a house together. We currently live in the flat that he owns but it's too small now we also have a child.

I also own a flat that is currently being rented; it’s a lot less valuable than his: worth less than half.

We plan to sell both flats to buy our forever family home.

His family have very generously offered to help us buy a place, but they want any money they contribute plus the money he puts in from the sale of his own flat (they originally purchased it for him) ringfenced with a Tenancy in Common agreement whereby I am only entitled to the exact amount I put in (and the corresponding percentage of interest if it accrues value) if the property is ever sold. They also want us to buy in a particular, and very expensive, area as a condition of contributing the money. I think I would end up owning about a fifth of the property.

I don’t know how to feel about this. On the one hand, I can absolutely understand their desire to protect their wealth and it’s completely fair. On the other hand, I’m struggling to get over how much less financial security I will have than my husband should our marriage ever end. (We really love each other and have a strong and honest relationship, so I’m not expecting this to happen, but then who is?)

I am feeling extremely financially insecure as my career (and self esteem) has taken a big hit post maternity leave as I’ve struggled to find steady work (I freelance). I have mostly been living off my rental income (which I will obviously lose if we sell my flat to buy a family home as per the plan) with my husband covering our major expenses.

I also still look after my daughter one day a week and am the default caregiver any time she wakes in the night, there’s a nursery inset day or she’s off sick (which is a lot!). We are also talking about possibly having a second child, so I’m aware my earning potential might suffer more over the next few years, not least because I will be exhausted.

i think I’m also scared that our financial situations will get further and further apart and I’ll be constantly worried about how I can earn enough to give myself a decent safety net and/or that I won’t be able to keep up with the lifestyle my husband aspires to because I’ll be constantly trying to save!

The bills on a big house will be higher, as will the cost of living in the area his family wants us to buy. I also think I just don’t like the idea of owing only 1/5 of our family home. I guess I want to feel like equals and like a team and I also worry how I’d buy another home suitable for two children in this very expensive area (presuming they’d be at school there) if he ever left me.

It seems that with a Tenancy in Common agreement I also wouldn’t automatically get the house if my husband died, so I have a fear that should that if happened, my children and I could get kicked out of our family home if his parents decided to sell (I think this is very unlikely as they are good people, but it still makes me feel insecure).

Does anyone have any advice? Am I looking at this the wrong way? I want to feel happy and excited about the prospect of moving to a lovely new home together, but I just feel anxious and sad.

Gifts can be a firm of control and that's exactly what's happening here. Your husbands family are happy to gift but there are strings attached. If you want control then you, as a couple need to refuse their offer and buy somewhere you find more affordable. Your career has been affected by having a child it would seem fairer if you move forward as equals.

I would t buy a house under those conditions. Partners in a marriage should be equals, regardless of earnings.

I can see why they might want the deposits ring fenced but the rest should be 50/50. Also very difficult re their conditions of locations etc but you don’t have to take their money - one of my dear friends got very upset that her MIL kept vetoing everything she liked but essentially that was the condition of their gift of the deposit - her in laws picked her house. I did have to say to her at one point that she could choose not to take their money.

I would in this order get legal advice, talk to your dh and push back against those conditions.

Marriage, in very brutal terms, is (partly) a business deal. And at its best the deal recognises the contribution of those who put in skill and time to care for members of the 'firm'. As you are painfully having to recognise, being a primary carer is both essential work that can't be completely farmed out to others, and unpaid. But because you are married, there is some protection for you in the setup.

If your dh's family are choosing to ignore the fact that you are also now a member of their family and an essential skilled worker in the 'business' of your immediate family (so essential that you are literally irreplaceable - about the only 'business' where that's the case) then you might have to refuse their money. But start with legal advice on what this would actually mean, if you split.

I would definitely be wary of the resentment this could bring.

I would have a frank chat with your husband and explain the consequences of maternity leave/primary carer on your earning potential. If that's not reflected in your family set up then you need another income source and need to keep the flat.

I would be very wary of the location demand, they sound very controlling.

This is totally unreasonable and probably not enforceable (as far as I’m aware); if you were to get divorced, who owned which bit of the property would be largely irrelevant in who got what in a settlement.

You need to have a proper conversation about money. Set aside the gift from his parents - you are married, you’ve given birth to his child and continue to sacrifice your earning potential to look after her. I’d insist on consolidated finances across the board, no yours and his. If his parents want their gift to be ring fenced I’d be fine with that but the difficulty they have is that they either take an interest in the property (not good for IHT planning) or they give it to their Son and then I suspect it’s fair game if you got divorced anyway.

This is unreasonable. What would you do without their help? Would you be able to buy something suitable in a cheaper area?

Marriage invalidates a tenants in common agreement.

But in any case, you can't buy a house under these circumstances as your husband clearly doesn't see you as equal if he is prepared to agree.

Tell him his family aren't having any input and make sure you protect your own earning power. This might mean he steps up more with childcare so you can focus on your career.

I’d have to be petty and ensure you are paying bills, mortgage and renovations at 1/5!!! Oh and cleaning!!

Are they actually giving a 4/5 deposit? If so I kind of get why the want to protect that but you need to ensure you are safe too, I would get this and a will written up but if you aren’t comfortable now you won’t ever be so you and your DH both need to agree as a duo not you vs him and his parents

It doesn't sound like they are helping you to buy a place. They are buying it and 'allowing' you to own a small part of it. What if you wanted to change some part of the house or move somewhere else? You would always need their approval as they would be the main owner. I would not do this.

Family homes are marital assets, so regardless of such ‘safeguards’ it would all be taken into account in the event of a divorce. They are being ridiculous. All the more so because you have children together and therefore your children would be the beneficiaries of your respective estates, so it really makes no difference. A hey are creating unnecessary tension at the heart of your relationship. It’s really not on. I’d refuse the money.

I would run a mile from this ridiculous ‘offer’. It sounds very financially controlling of your PILs, and also of your DH if he thinks you should go along with it! Im by no means rich, but have been able to give both my DDs a decent amount of money towards the purchases of their homes. The money was a gift and I certainly did not expect to have any say in the properties they bought or their locations!
Your DH should lower his expectations. By all means sell both your properties to buy a bigger joint one, but I would want this to be owned as joint tenants rather than tenants in common in different percentages.

Considering 50% of marriages fail anything I’ve worked hard for and pass on to kids I’d want protecting

ultimately as harsh as it sounds your not losing anything you just can’t get your hands on what you haven’t brought to the table

human nature being what it is the response to the situation depends what side of the fence you are on
if it was you in his position you’d hear the screams from space to protect your assets

Op, I would see a solicitor first just to check whether such an agreement would be permanently legally binding or if you were married for ten years, sick, or off work with three kids if you’d be left homeless by a divorce. Try to work out the worst case scenario.

I’d also do a budget and start populating it with some numbers to prove to your husband that you’d have nothing left if you were contributing to a house in a more expensive area and how it doesn’t seem like an equitable way to have a married life. Factor in pensions too, make sure you can afford to pay into one.

It’s understandable that they’d want to protect their assets but this does sound overly controlling and makes it harder for you to grow your assets. There’s no recognition of the reduction in your earning power.

I also wonder if this is the right stage of your life to freelance? Would you have more security in a permanent job giving you maternity pay and a pension? I get that freelancing can give you a lot of flexibility to do childcare but even without your in-laws money what would be your plan to support yourself if you sell your flat. Or if you chose not to sell your flat how would you pay for repairs / maintenance or you’re using the rent on your living expenses. Your dh should obviously support you but perhaps you should be explicit about what that means ie joint finances or him being part-time even to give you a chance to build assets in your name.

Like others I get ring fencing. But only owning a proportion of the house in a % of that? And moving where THEY want?

Nope sorry.
Moving where they want is simply controlling.
The% of what you’re paying is crazy. What if your dh has an accident and you’re the one paying all the mortgage??

Id also be querying the fact you feel you have to ‘keep up’ with your dh spending (eg to go in hols).
Youre married. You have his child, planning for a second child. Your finances should be pooled. For the simple reason that you’ve given up your financial safety to have a child. You’re the one shouldering the childcare and all the inconveniences.
I would look for a salaried job too. Only because it would give you a peace of mind you dint have atm. And some safety re pension etc… too

Thank you all for your input. It’s really helpful to get some outside perspectives.

I don’t think I’ve been totally clear; we would own the house outright. Well, my husband would own 4/5 and I would own 1/5.

I will definitely seek legal advice, because I am worried about what would happen to me in a worst case scenario.

And to the person who brought up my freelance career- yes, I am currently looking for a permanent job (no luck as yet). I think income stability will help protect me financially, but I’m also aware it will be harder to progress/get promotions when I’m also the primary caregiver.

Them telling you where to buy a house is crazy controlling. As is the financial set-up where you lose. Can you and DH afford somewhere where you'd actually choose to live?

Also, why are you default parent? This needs to be sorted, particularly if you are having another child. Pension? NI contributions etc

It’s all too much. Sorry OP. What sounds ‘generous’ isn’t really, in these circumstances. Either you keep your flat as a rental - or you don’t borrow from his parents under those rules. And live within your means as a couple. I totally understand them wanting to keep their capital in case you divorce but as you’ve outlined- implications for you would be awful. It’s just inadvisable - all the stories we see on here and in our own lives / friends’ lives.

You’re married with children - upon divorce any financial agreement that’s not 50/50 will only be taken as ‘advisory’ so their plan of to ringfencing all assets in their son’s favour is moot anyway. A good lawyer and judge won’t let it be unequal upon divorce.

What does your husband think of this plan? Is he receptive to your worries, or dismissive? Would he say no to his parents?

Tell your husband the only way that set up is reasonable is if he becomes primary carer so you can maximise your earnings going forward. If he says he can't because of his job then that proves the point. He only earns more because you care for his kid. You will always be impacted by caring for his kid while he continues in his career unhindered. Ring fencing what his stents put in as a deposit is reasonable but punishing your for having his kid is not. I would not sell your flat if you rely on the income and to be blunt the fact you live off that when he earn and owns a house says to me he thinks very little of you

Not at all. Tenancy in Common agreement as OP outlines, means they each take out what they put in. Legal agreement.

(Its a great idea if for example you’re in a blended family and on your death you want your inheritance to go to your biological children (as we’ve seen other parent remarried and gives what was your kids money to his / her kids. Linda Bellingham effect). )

It seems that with a Tenancy in Common agreement I also wouldn’t automatically get the house if my husband died, so I have a fear that should that if happened, my children and I could get kicked out of our family home if his parents decided to sell

His parents wouldn’t be the owners (unless named in the Deeds) so couldn’t sell.

If he died without a will the intestate laws for where you live would apply ( in England you would get the vast majority of, with some going to Dc, depending on total value) . If he has a Will that says his share of the house goes to you then that is what happens.

Your worry would be if this man, so prepared to lean on his parents’ wealth and keen to comply with their wishes, were to succumb to them demanding he write a will leaving part of his share of the house to them!

You should both have a Will, anyway.

Keep your flat and your rental income.

It will make you feel better.

You could take out buy to let mortgage out on it if you don't have a mortgage already.
Criteria is based on the rent received rather than your salary.

This would enable you to add some of the equity to the purchase of a house with your husband.

@Sasskitty This is what I feared. It also seems it’s uncommon in people who are married and have shared children.

No way in hell would I take money with conditions like this attached & frankly if your DH is on board with the idea, I'd be ramping up my job search & insisting on more equal parenting/work balance to protect yourself should anything go wrong. Where you buy, the type of tenancy & what you do with your deposit from the marital pot - absolutely none of their business.

The only bit I could get on board with is ringfencing their gift but beyond that it would be a firm no from me.