If you’re buying a house with someone, having a Deed of Trust is an essential legal document that helps you and the other party, or parties, know exactly where you stand if the property is sold or one party is bought out. This will ensure that everyone gets their fair share in case of any unexpected or unfortunate events.
What are trust deeds?
A trust deed, Deed of Trust or Declaration of Trust, is a legal document that outlines the financial arrangements between property owners.
If you buy a property with a partner, friend or family member, a Deed of Trust will help all parties know where they stand should the property be sold or bought out by another interested party.
It can be difficult to predict what might happen to you and your finances in these circumstances, so a trust deed for property provides clarity and certainty in otherwise confusing times. It can also help reduce potential disagreements as everyone’s financial investment will be accounted for, with a plan in place to set out what should happen.
Should I get a trust deed?
If you’re buying a property with someone else, it’s generally worth having a trust deed in place to formalise any arrangements or agreements you might have made regarding your investment.
When you buy a property with another person, you’ll be asked whether you want to be joint tenants or tenants in common.
Joint tenancy means that when one party passes away, the other will inherit the property outright. If you’d prefer your share of the property to pass to relatives or a named person, or each party is contributing a different sum of money to secure the property, you can choose to be named as tenants in common.
Whether you choose joint tenancy or tenancy in common, a trust deed can be created to ensure that your investment is protected.
This also applies to anyone who is buying a property with financial assistance from someone else.
What does a trust deed include?
Our legal experts can help you assess what your trust deed for property should include, as this will depend on your individual circumstances. It might include:
- The sum of money that each party contributes to the deposit and what is to be repaid to them.
- The percentage of the property that each party will own.
- How the property will be split if it is sold.
- The sum that each party will contribute towards the mortgage and how it will ultimately be paid off.
Our legal team is here to give you advice to ensure that everyone’s interests are protected. Get in touch with us today to find out more.