Q. I am buying a house jointly with my girlfriend. We are borrowing 60% of the value from the Bank and she is paying the balance from her savings. Will her additional contribution be reflected in the property ownership arrangements?
A. It can be, if you want it to. Joint purchasers can hold property in one of two ways; either as joint tenants or as tenants in common. If you hold the property as joint tenants, you will each own the whole of the property together which means that, when it is sold, you would each be entitled to 50% of the sale proceeds. Furthermore, on the death of one joint tenant, their interest in the property automatically passes to the survivor, who would then own all of the property. This is the way married couples generally hold property.
However, holding the property as joint tenants would not recognize your girlfriend's greater contribution. To achieve that, you would need to hold the property as tenants in common. Here, each owner owns a distinct share of the property which does not pass to the survivor on death. For example, if you wanted to accurately reflect your respective contributions towards the purchase price, your share would be 30% (being one half of the 60% purchased with mortgage finance) with your partners share being 70% (being the aggregate of her 40% contribution and here 30% liability for one half of the mortgage).
It is important to specify now how you wish to hold jointly owned property at the outset to avoid any uncertainty in the future. For specialist advice contact Keith Swan of Patterson, Glenton & Stracey Solicitors by email at ks@pgslaw.co.uk or by telephone on 0808 231 7043. Patterson, Glenton & Stracey Solicitors have provided legal advice to the people of South Tyneside for over 125 years. For details of their full range of services and to view previous Gazette articles please log on to www.pgslaw.co.uk . Patterson, Glenton & Stracey Solicitors: the Logical Answer .
