Relationship issues prevents first time buyers from seeking legal protection
It is becoming increasingly difficult for people to finance house purchases due to rising cost of homes, pushing those living on their own further out of the market.
First time buyers are resorting to complex schemes to finance the purchase of their first property. Recent research showed that people are combining their funds to get on the housing ladder. The increasingly intricate nature of property transactions shows that almost half of the people interviewed suggest the need to utilise three or more additional sources to fund their first house purchase. This may include loans as well as gifts from parents and other relatives, partnering with friends to purchase, or engaging with one of the government incentive schemes.
This is a complete shift from the days when the younger generation was able to simply obtain a mortgage through saving for a deposit and moving in to a new house, whether they were single or with a partner. The number of first time buyers expecting to employ at least two sources in addition to their own funds in order to finance a purchase has grown to around 70%.
However, many of those placing the deposits would be reluctant to secure their financial contribution with a legal agreement should a relationship breakdown occur. Also, many who have put down uneven deposits, have not underwritten the percentage split for fear of “damaging trust”, which could potentially jeopardise a relationship. Where financial proportions are unequal in nature, a legal contract stating the source of each contributor and their share would secure protection of their input.
However, in the absence of a formal legal contract where a breakdown does occur, the prospect of obtaining the original share submitted cannot be guaranteed. This could therefore become even more complicated should party dissolution occur.
Although contributions from a network of relatives and friends can be welcome, the prospect of future difficulties for families is highly likely and emphasises the need for putting a legal agreement in place.
Askews Legal LLP solicitors offer legal advice to people involved in group purchasing of properties in the Coventry and Warwickshire area. We provide a full conveyancing package at a competitive price which helps our Clients to avoid any unnecessary and costly surprises. Why not try our online conveyancing quote calculator Click Here Conveyancing is a critical task before buying or selling property. The implications of any decisions need to be carefully considered. So why not contact us to discuss your situation and to better understand which option is best for you.
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