If you are buying a property with another person, you should consider having a declaration of trust prepared. Before completion, you will need to consider if you would like to own the property as ‘joint tenants’ or as ‘tenants in common’.

Joint tenants means that you will both own the property as a whole. You will not be able to dispose of your share under the terms of your Will. On death, your interest in the property will pass automatically to the surviving co-owner by a process known as ‘survivorship’.

If you own the property as tenants in common, you will each have a divisible share in the property. On death, your interest will pass under the terms of your Will rather than by survivorship. If you do not have a Will, your interest will pass in accordance with a set of rules known as the ‘intestacy rules’. It is therefore important to consider having a Will prepared if you own the property in this way, particularly as these rules are subject to change.

A declaration of trust can record how much of the property you each own. This is of particular relevance if one person will be contributing more than the other towards the purchase price, the mortgage repayments (if applicable) or even home improvements. If you are considering helping your children onto the property ladder, a declaration of trust can protect your money from divorce or bankruptcy.

In the absence of documentary evidence and in the event of a dispute, it will be for the court to determine the extent of each co-owner’s interest in the property, based on various factors. This is a costly and time consuming process. It can also be extremely stressful because of all of the uncertainty. A declaration of trust can prevent such a situation from arising by setting out exactly what has been agreed at the outset.

We can advise you on the whole process and deal with the necessary formalities at the Land Registry to give effect to your wishes and ensure that your interests are protected.

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