Your home may be repossessed if you do not keep up repayments on your mortgage.

These days not everyone is married when they buy a house and very rarely do both people buying put in even amounts of money from their own savings. More often than not properties will be purchased by unmarried couples or even between friends. In these scenarios, it is highly unlikely that both parties will be evenly contributing to the deposit especially if you are receiving help from a family member for your portion of the deposit too.

Let’s firstly look at the definition of the two main ways you can purchase/own a house and then we’ll delve into what these mean in a bit more depth.

Joint Tenants – Two or more people own property together, each with equal rights and responsibilities. You are both jointly and severable liable.

Tenants in Common – Two or more people own a property but each owner has their own distinct share of the property. If something happens to one owner, the other doesn’t have the right of ownership over that persons share.

Married/Civil partnered couples will almost always opt for Joint Tenancy as everything is shared equally. But unmarried friends/couples should consider whether Tenants in Common would suit them more.

There is nothing to say that Joint Tenancy isn’t the right way to go for Friends/unmarried couples but it’s worth thinking about.

Let’s look at an example:

Client A and Client B are an unmarried couple and are first-time Buyers. Client A has saved up £10,000 to contribute to the deposit whereas client B is receiving a gift from their parents of £50,000. Client B’s parents would like to protect this gift for their child to make sure that should Client A and B go their separate ways, Client A can’t financially benefit from their gift.

This scenario is quite a common one. The answer is that these clients should discuss with their solicitor taking a mortgage as Tenants in Common. This way they can have the property shares set up to make sure that should the clients wish to go their separate ways, Client A would get their £10,000 back and Client B would get their £50,000.

When setting up your mortgage we will discuss these options with you but ultimately it’s down to your solicitor to make the arrangements and they will be able to explain in most depth.

We can help with solicitors recommendations too should you need to be put in contact with someone that will be able to help with any purchase or remortgage.