I want to buy property with my partner, don't know if and how its possible to do so even if we are not married. We plan to marry at the end of the year but we saw a very nice property which we really like. And how will that arrangement change when we eventually get married. Any help appreciated
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Buying property with partner
- Thread starter vic86
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Former member 61586
Guest
can be done. doesn't matter that you are not married. marriage will make no difference as you will still gave 50% of the property in your name.
Speedster
Honorary Master
Although ONLY do this if you're genuine about the marriage plans. Buying property with a non-marriage partner is a nightmare should you ever part ways.
BackStabbath
Senior Member
Agree on the above, this document/agreement should be signed by both parties, as it will protect them should any dispute arise in the future. Remember if one person defaults on any of the payments, all partners will be held liable the bank does not care what happens they want their installments. Another measure would be for each partner to draw up a last will and testament addressing what happens to the property should anything happen to them. Lastly remember to keep record of all your payments.
Smugs
Expert Member
All of the above..I did it before I got married.. The property goes in both parties names. when I got divorced I had to pay her out half the value of the house..
newby_investor
Executive Member
To answer the original question, sure it is possible. I own a property jointly with my dad, fwiw. Definitely not married to him...
quovadis
Honorary Master
Just sign a agreement between the two of you that states that if there is a breakdown in relationship what will happen with the property (ie disposal or buy out etc) and how the value of the property will be determined etc. Also note that if one sells the other their share of the property there would be costs that need to be paid.
yup, preferably an agreement that will stand up in court
Too often, the division of who pays for what, in a partnership or marriage, is skewed. Not necessarily OP, since they've been together for years and probably have sorted all that out. So this is written for others who may read this.
If the agreement is that one partner will pay the mortgage, and the other the groceries, that automatically leads to an imbalance. If there's a split, the house still exists, but the groceries are long gone. Similarly, if one pays for the mortgage and the other for the decor and fittings: in that case such items (like carpets or taps) can often not be re-used fully in a next home. If the non-mortgage partner pays for, say, the alterations, then they are both contributing, but perhaps not equally, and less steadily, as the mortgage is a fixed amount, while renovations can end up costing more than planned. The earnings of one partner may need to be offset against the free labour provided by any partner who stays at home full-time to do the homemaking or to care for the childen or to nurse ill siblings or aged parents, or who is investing time with no income while starting a business.
No one model is right or wrong for all couples. The point is that the conversation should be had, before signing
- the mortgage contract,
- the personal contract between the two, of what they would do, who would compensate whom, how much and how within which time-frame, in case they were ever to split up, and
- the joint life insurance to protect the remaining partner (and to pay up the mortgage) should one die.
Would you be willing, please, to explain something of the agreement you have with him, and what you've planned if either of you dies or wants to dissolve the joint ownership?
quovadis
Honorary Master
When you purchase a property jointly the property is divided according to tenancy and registered as such so one person can own 30% and the other 70% or 50/50 or any number of people can have varying percentages. What each person contributes in terms of payments or expenses etc is irrelevant to the ownership even if one person defaults. If there is a joint bond though the responsibility is not severable because one can pay his share and the other cant.
Some considerations:
1. Value - THE most important first consideration is the determination of how and who will value the property (otherwise you can have disputes for years about what the actual value is) - this is paramount. ie. 3 Valuations from companies x,y & z averaged or average price per sqm for the estate over the past 5 years or a combination of both.
2. Windfall - An agreement that if for some reason someone comes along and offers a massive price for the property that it can trigger a full sale if voted on by x number of parties. ie. You don't want a situation where 3 people own a property they bought for R1m and then someone comes along and offers R10m because he wants more parking and 1 co-owner holds you to ransom.
3. Dissolution - Should the relationship be dissolved the safest way to is to agree to a sale of the property if within x% of the valuation and the proceeds to be split accordingly if no agreement can be made in terms of which party will buy out the others share.
4. Honoring Expenses/Commitments - Ideally the contributions (monetary or otherwise) to the payment of the bond, maintenance etc should be agreed in writing and that should one default in their commitments it can allow the other to institute options in terms of dissolution.
5. Death - This is tricky but usually a person's last will and testimony will dictate what would happen in the event of death and who would inherit the share in the property.
I would always recommend whoever does this to create their version of what they feel is fair as a draft and then consult an attorney to provide a formal agreement incorporating the draft and do so BEFORE purchasing a property or making any offers etc.
newby_investor
Executive Member
In my case, it was probably poor practice, but we don't have anything formal in place, just verbal agreements. It was my first property, I didn't have much of a credit record so Dad came on board and effectively "signed surety", even though I was paying for it at the time.
Since then, he's taken over payments, I've moved on, and he and my mother are living there at the moment. If I die, then my wife inherits my 50% share. If my dad dies, then my mom inherits his 50%, just the same as the other assets in our respective estates.
We haven't thought as far ahead as wanting to dissolve the joint ownership. But the plan is only to keep it for a few more years, so we'll probably just leave it as is until we sell, then divvy up the proceeds as we've agreed. (For some families this may not work, so I'd generally recommend getting something in writing. But for me, it works well enough.)