What to consider when moving in with a partner who has a mortgage
When moving in with a partner who has a mortgage there are some considerations you need to have taken.
In this brief guide, we will cover what you should consider when moving in with a partner who has a mortgage.
You may want to consider if your rights differ as a cohabiting couple from those of a married couple.
When you move into your partner's house but aren't married this is known as cohabitation.
What is cohabitation?
Cohabitations is when you live with someone you aren't married to. When cohabiting you will have different rights than someone who you are married to. Your rights will also change depending on if you have children and how old they are.
The rights each of you have will also depend on if you are both in the mortgage agreement or just one of you.
When you move in with a partner who has a mortgage you have no rights or claims over their mortgage and if they die you will still have no rights or claims over their mortgage except they have stated so in their will.
becoming a joint owner with your partner after moving in
The only way you can have any claim after moving in with a partner who has a mortgage is to ask them to be joint mortgage holders.
To do this the mortgage lender will also have to agree to it and may need to perform a mortgage affordability test on you to see if you would be able to keep up the monthly mortgage repayments should anything happen to your partner.
This may not be the basis on which they will add you as a joint owner as they may still add you as a joint owner on the property if your partner is still able to maintain the monthly mortgage repayments.
When you transfer a property or add someone as a joint owner there may be some tax implications and you should seek tax advice on this.
When you become a joint owner you could either own equal shares as your partner or have unequal shares based on what you decide.
You and your partner will both have to seek independent legal advice when becoming joint owners.
In some cases, your partner may not want to add you to the mortgage on their property. Both parties should still seek independent legal advice when someone moves in with their partner who has a mortgage.
A cohabitation agreement
When you move in with a partner who has a mortgage or your partner moves into your home and you have a mortgage you should obtain a cohabitation agreement to govern the parties’ respective obligations and interests in the property.
Cohabitation agreements work based on trust laws and you must be very careful not to fall into any trusts you didn't intend to.
If your partner pays for the mortgage or pays for home improvements which have increased the value of the property then they may have an interest in the property.
A cohabitation agreement will go a long way but may not solve every problem. You should ask your solicitor any questions in regards to specific issues that may concern you.