Blimey this thread has really run away with itself and I am not sure if some posters have actually read my original post as there are a lot of assumptions being made. @7yo7yo where did you get the idea that my partner wants half the house for 30% of the money?!?
To put everyone's mind at rest I will summarise the situation and answer your questions one last time:
My partner is buying 50% of my house. We decided against selling my house and buying something new together. We have made improvements to mine and like it a lot so have decided to stay here. Not an unusual decision in the grand scheme of things. If I had decided to sell, I would have been left with some equity left over to do with what I wanted so I am not sure why posters are getting so hung up on him buying into my house. It is also the commitment we have decided to make to each other in lieu of marriage which we may do later for inheritance tax purposes.
The house is bigger than I need as a single person and has taken a lot of renovation. I would have downsized if I had remained single so I am not giving up the security of my house or as some are suggesting making myself potentially homeless in the future. My daughter will be moving on in the next couple of years and I have already made the provisions for her below which is another reason I don't need a house of this size to myself. If things don't work out with my partner and I have to sell to take half the house towards another property, I have pension funds that would cover the difference if I decided I wanted to replace the size of house I am leaving which I probably wouldn't do. I would buy either a new build apartment or a two bed cottage, smaller, cheaper.
In the event of my death, I have an insurance policy that pays out to my daughter for a sizeable sum of money. She would also inherit my pension funds, again sizeable. She would be well set up to buy herself a property outright straightaway with lots to spare.
In the event of my death my partner will either have to sell the house and take his share to buy another property and the remainder goes to my daughter or if he has purchased the whole 50% at this stage he can remain there until he dies at which point my daughter will inherit my 50%. I will have a will drawn up when he moves in to reflect this. It will only reflect the amount invested already, we will have to update it as the amount changes.
I have already taken legal advice about the beneficial interest but as I explained in the initial post my mortgage company require my partner to go on the mortgage which is not in my interests. My question was about the other technicalities of ensuring that the money he has already invested is recorded was what I was seeking advice on. Although most posters seem to have jumped on my reasoning for selling half my house!
My partner does not want to cash in his investments or pension at this time because the stock market has taken a hit because of Covid 19 and it makes much more sense to pay my mortgage at the low rate than lose the value of the shares. He is very canny with investments and that is a sound reason not to cash them in. It isn't possible to raise a 50% mortgage on a property which has someone else's equity for the other 50%. Nothing sinister about it. I would also add that my partner behaved impeccably and with total integrity and honesty in his divorce negotiations, something my ex husband definitely didn't. Hence why I want a future with him.
The intention is for him to wait until the stock market increases and pay off the whole mortgage in one hit in around 2.5 years when my fixed rate ends, avoiding redemption fees.
The money that is released to me from the 20% equity he will purchase will be reinvested by me, probably shares, to enable me to retire a bit earlier than planned and a lump sum given to my daughter for her own property purchase. I would have taken this money from my pension fund. It makes more financial sense to leave my pension fund, which is a SIPP, alone as it is powering away despite the recent dip caused by the stock market. One of my funds has achieved 46% increase in the last few months. My house would not do the same and it is very likely that house prices will fall soon.
So in summary the person most vulnerable in this situation is my partner as:
- he has already invested a large amount for house renovations on a property that he has no legal claim on. He is not on the deeds or the mortgage and will remain that way until he has paid for the 50% he intends to buy. I will put him on the deeds as a joint owner at the point he paid off the mortgage and settled the other 20%. We are not married so the maximum he can claim is what he has actually paid for which is fair in the scheme of things.
- we have talked about him paying the mortgage and agreed that should we split up before him paying the whole lot off, he will be refunded what he has paid minus an amount for rent he would have paid for accommodation. We intend to split the bills 50/50 although he pays for a lot of our social life, trips away etc (memories!) as his income is a lot higher. He is very generous.
- I am as sure of the relationship as it is possible to be. All relationships have an element of risk. There are no guarantees, hence why I have thought through all eventualities.
So ladies, please calm down!
I was only asking about how to get this tied up legally not for a critique of my life decisions.