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Posted on 1 May 2023

View the wider picture when buying a home together

Posted in Advice

Read time: 2 minutes

Buying a home is exciting but you must remember to consider legal ways to protect yourself. Having a conversation now about the possible future eventualities is sensible and could prevent legal and financial difficulties later down the line.    

Who owns the home you buy together?

When you buy a property with another person, there are two types of property ownership:  

Joint Tenants (Joint Tenancy)

You own the property equally irrespective of whether one person has put more into the pot than the other.

On death the property automatically goes to the other owner (Right of Survivorship). This avoids probate and inheritance tax issues.

You cannot leave your share of the property to anyone in your will.

Tenants in Common

You can own the property in different shares.

On death your property does not go to the other owner unless noted in your will or through the intestacy rules.  

You can leave your share of the property in your will.  

Couples, who are not married, tend to opt for Tenants in Common as the property can be owned 50-50 or in unequal shares. Whilst owning your property as Tenants in Common provides legal protection, there are additional ways of protection you should consider, too.

How to protect the home you buy together

Declaration of Trust  

A Declaration of Trust is a legally binding document made at the time of buying a property. It sets out your financial arrangements, detailing shares or what sums of money are paid back to each party in the event that the property is sold or disposed of in the future.  A Declaration of Trust is a great way to avoid confusion or assumptions.  

Cohabitation Agreement

This is a legal document between unmarried couples who are living together. It can cover bank accounts, debts, household bills, vehicles and even care of pets in the event of the end of the relationship.    

When life decisions require legal advice from different specialist areas, you will see the benefit from using a team who work together across departments, to provide you with one seamless service.