Homebuyers urged to protect deposits
People buying a house together risk losing their investment if they do not seek legal advice first, according to the body that represents solicitors in England and Wales.
Co-habiting couples or two friends buying together have no protection of their initial investment when it comes to selling up and are not protected by law in the same way that married couples or civil partners are, the Law Society said on 23 May.
However, a solicitor can draw up a declaration of trust that clearly states what share of the property each person owns, as part of the conveyancing process. The society said that without such a document, each would have a right to half the property but no more.
Law Society president Nicholas Fluck said the fluctuating property market meant that more people were teaming up in order to afford a home, which could create problems.
He said: “As banks demand bigger deposits and house prices rise, the money at stake is considerable.
“Buying a home is a huge, expensive step, and of course it’s exciting, but before signing anything, make sure your deposit is ringfenced.
“No one can predict the future, but if you need to sell the house for any reason and move on, it’s better to come away with your fair share and avoid a messy legal dispute.”