Q&A - Safeguarding my cash deposit when mortgage is in his name

Q:  My boyfriend and I want to buy a house together but only he can get a mortgage and pay it as my earnings are low and irregular. However, due to being given a substantial amount of money by my godmother, I am the one who has the £12,000 for the deposit. How can we ensure our differing interests are safeguarded in the event that anything should happen to one of us or we should split up?

A:  Any couple who are co-habiting but are not married should set up a Trust Deed which clearly defines at the outset how assets should be split in the event that they cease to live together for whatever reason. In your case it would be particularly sensible as your financial contribution will be a lump sum whilst your boyfriend's contribution will be the monthly mortgage repayments. You will each need separate legal representation to set up the Trust Deed.

The property would be registered in your boyfriend's name and he would hold legal title to it, but the separate Trust Deed would be in joint names to specify how your equitable shares are held. In the event that anything happens to one of you, or if you should cease to live together, what would normally happen is that the outstanding mortgage sum would be repaid first. After that the capital sum, i.e. the deposit, would be repaid to you, and finally any remaining monies would be split in accordance with what was laid out in the Trust Deed.  

Whilst having the Trust Deed drawn up it is also worth considering making a Will if you don't have one, or updating an existing Will, to ensure that your share of the property passes to whoever you wish it to in the event that you should die.