Top Legal Tips For Buying A House With Friends
High house prices are making it harder for young people to get on the property ladder – which is why more and more are choosing to buy a house with friends.
On the surface, pooling your resources with friends to buy a property can seem like an ideal solution to tackling the dilemma of how to get on the first rung of the property ladder. However, there are many factors to consider and it’s important you think carefully before going ahead with such a joint purchase.
Top 3 Considerations When House Buying With Friends
How Are Payments On The House To Be Made?
When it comes to finances, consider whether you and your friends will pay the deposit, mortgage payments and other bills equally or not? Also, what happens to a person’s share of the property if they die?
You need a declaration of trust to cover all the details regarding payments. The declaration should state the shares everyone owns in the property and how the shares are to be divided when the property is sold, as well as what happens to the shares if someone dies.
How Easy Is It To Buy Another Property At A Later Date?
If a co-owner wants to take his or her money out of the house in order to buy somewhere else, does the property need to be sold? Or can you and the other co-owners buy out the person leaving and on what terms could you do this?
Other considerations on this topic include Stamp Duty Land Tax as buying a second place means you’re no longer considered a first-time buyer. If you or a co-owner can afford to buy another property whilst retaining interest in the co-owned house, an extra 3% Stamp Duty Land Tax on the purchase price has to be paid.
What Does Joint And Several Mortgage Liability Mean?
Mortgage liabilities are joint and several, meaning if a co-owner leaves or another is no longer able to pay due to job loss, you and the others are liable to pay the mortgage.
How We Can Help You With Your Joint House Buy
Our professional conveyancing team has extensive experience when it comes to helping individuals as well as co-buyers to purchase their property in the least-stressful and most beneficial way.
If you’re thinking of buying a house with friends, it’s important you only undertake such a venture after seeking professional legal and financial advice first.
We will tailor our advice to your specific needs and the type of buying relationship you have with your friends, to ensure you’ve considered every aspect of your house buy – for today and for the future too.
To speak to one of our specialist conveyancing solicitors about buying a house, contact us on 0800 988 3674 or email advice@bartletts.co.uk
