Adding partner to mortgage, can anyone help me work this out?

[LadderLady]

Struggling to get my head around the best way to do this. I own a house worth roughly £200,000 with a £60,000 mortgage. My partner and I were looking to move and buy somewhere together but can't find anything so we'd like to stay in my house.

Partner has £20,000 that he'd like to invest in the property. We'd then like the remaining mortgage to be in both our names, and borrow an additional £30,000 to do some home improvements.

Need to then draw up an agreement to say who owns what percentage? Or maybe protect our initial money (so if we were to split and sell, he'd get his 20 back, I'd get my 140 equity back and then any additional profit be split 50/50?)

Would we pay off 20k from my mortgage then borrow 30k between us?

Do we use the 20k for improvements and just borrow 10k, add him to the mortgage and I'm 'giving' him part of the house because he's using his money to add value? And would that come from my current equity?

I hope I've explained this properly, I've spoken to my current mortgage provider and they weren't much help, just wanted figures. Maybe we need to just speak to an independent advisor?

Are you married?

Are you sure? Seems like a good way for him to get half a house for 20k here.

You need a solicitor to give you legal advice about co-owning on a tenants in common basis, with different shares. Get your own legal advice.

No we're not married. How would he get half a house if we protect our original investments and then split any profit made moving forwards?

Or if we have it written up that e.g. he owns 10%, me 70% and the other 20% mortgaged?

This is too important to ask a bunch of random posters on Mumsnet, Op.

When I looked into this we would need to register him on land registry and pay more stamp duties etc was not worth it

I would advise anyone against doing this. A property of your own is the single most significant financial asset you can have. Why would you let someone - anyone - put £20,000 into it and have a share? You can presumably afford the low mortgage. You have tons of equity. You don't need his money.

Don’t do it. Keep your autonomy.

This!

Don’t do it. You’re blowing up your only stability.

You need a solicitor to draw up an agreement eg that says on selling you get £140k, he gets £20k then the remainder is split 50/50. Then you just withdraw £10k essentially. Get the agreement drawn up professionally which will cost a few hundred.

You honestly need sound legal advice here. Are you absolutely sure you want him to buy into your home? If you are then get a contract drawn up water tight to protect your equity in the home or he will walk away with half of it in a few years time. It is not as easy as just adding his name to your mortgage. Too much to go into here so please see a solicitor

I would not do this, he can invest his 20k in another property or something else and you can keep your security. Also I wouldn’t get married to him either.

I would say that adding him to the mortgage and adding him to the land registry are different things.

it is doable but you need a solicitor. It won’t be an unusual situation.

however what we did in a similar situation was kept everything in my name, dh (we weren’t married at the time) paid me “rent” inclusive of bills which was pretty low (much lower than he would have paid elsewhere) so it enabled him to save and me to overpay the mortgage a bit. Eventually that put us both in a good position to buy together, some years later.

I’m not sure how it works for an existing property but when you buy new property together you can either specify you’re joint tenants or tenants in common with the Land Registry, so assume you’d need to do something similar. I agree with an earlier post that also set out having his name on the mortgage and the title are two different things, but I certainly wouldn’t add him to the title without adding him to the mortgage (you’d essentially be solely responsible in the bank’s eyes for paying the mortgage in that case but he’d still have rights over the property).

Joint tenants means you both own 100% of the house. If you were to ever break up, the courts would form the starting assumption you’re both entitled to 50%, regardless of what either of you put in. 100% of the property would also automatically pass to him in the event of your death (as he already owns 100% of the property).

Alternatively, you could specify your tenants in common, which requires you to set out which share of the property you are each entitled to (70% / 30% split etc). The court’s starting assumption is that split.

With either of these options, unless you’re willing to buy him out if it goes south (or sell the house and each take your share), I’d think very carefully before proceeding and seek independent legal advice before you do anything.

Something else to look out for - even if his name doesn’t go on the title / mortgage but he has put a substantial amount of money into the property (paying off a chunk of the mortgage / paying for renovations) you may still end up in a situation where he has some rights over the property.

Given the complexities, before any major investments are made on his part, please make sure to get independent legal advice before you proceed.

How old are you and do you have children plan to? Both of yours?

I think you shouldn’t have him buy into it but you should charge him below market rate rent then encourage him to buy his own place. If that gets rented out or on air bnb then he starts paying you proper rent

As a test why don’t you at least have him paying rent only (with written cohabitation agreement) until your current mortgage produce ends

Then he can pay cheaper stamp duty if he doesn’t already c o own your home

Get some legal advice. He stands to gain a lot from this situation and you stand to lose a lot.

So, if in the future you split and sell, and share the surplus, he gets the same return as you on a 20k investment versus your 140k investment? Defo get legal advice!

You need proper legal advice your mortgage company don’t care about protecting individual shares of the property it’s not their job to do that. Go and speak to a solicitor and get advice on what’s possible the get a proper legal agreement in place before any money changes hands.

No flipping way. If he wants to invest 20k he can find another way to do it.

Nope. You will be the loser in this situation.

He can put the 20k somewhere else? Save up for a flat to rent or something?

What do you gain here by the remaining mortgage being in joint names?

Right now you have a large amount of equity and low mortgage payments, yes you can have your originally investment ring fenced, but right now you own 100% and unless you’re struggling to pay the mortgage I don’t see what you gain except giving up 50% of the remaining equity.

I wouldn’t get financially intertwined like this when you’re not married, but equally I wouldn’t marry him either - doing that would effectively give him 50% of your house.

I don’t see the point of paying off £20k of the mortgage just to borrow £30k that you’ll pay interest on, there’s no logic in that.

Does he not own his own property? What age are you both? I’m concerned he sees this as an easy way to jump on your original investment and you potentially end up worse off.

You need to become tenants in common, the doc states both your shares. Do not follow the usual mumsnet batshit advice to get married- then you’re putting half your house at risk instead the ten percent or so he’d get this way.