Buying with friends- yay or nay?
With house prices increasing over the past decade, more and more people find it difficult to get on the property ladder. Because of this, a new trend is shaping up – co-buying with friends. But is this a good idea?
Some people believe that co-buying is the only way forward to get on the property ladder with property prices being so high. By doing so they can afford to buy a bigger property in a better area compared with what they may have afforded on their own.
At the same time, some mortgage providers have noticed this trend and have started providing mortgages for multiple purchasers.
Although it sounds good on paper, there is always a risk of what happens if, for example, one of the co-buyers decides to move on or if one of the parties cannot afford to pay the mortgage anymore (the mortgage will still need to be paid by the remaining parties).
Co-buyers can set out in writing how the property was purchased and each person's share in a Declaration of Trust. This is a legal document that sets out how the property is owned between them and their financial contribution to the purchase, such as each buyers deposit contribution.
A Declaration of Trust can cover different situations such as what should happen if one of the parties wants to sell or if there is a relationship breakdown. If written correctly, it can provide peace of mind and certainty as to what will happen in any given situation. This can prove invaluable in an already stressful position.
At Gepp Solicitors, we have vast experience of drafting Declarations of Trust to suit any situation and have helped many clients when purchasing their properties. If you are buying, or have recently bought, a property with a partner or friend(s) and would like to know how a Declaration of Trust can help you please contact our New Business Team on 01245 343980 or email newbusiness@gepp.co.uk.
