If you own as tenants in common, you will have specified the shares in which you will hold the equity in your property. If you contributed difference amounts towards the deposit or fees etc, it is sensible to have a deed of trust drawn up so that you can set out, among other things, what share each person owns, who is responsible for paying what and the procedure that should be followed when one or more of the joint owners want to go their separate ways. Having a deed of trust is especially important when each person is contributing differing amounts to the deposit, buying costs or mortgage repayments.

Most standard deeds of trust set out what each person will get back on the sale of the property either as fixed percentages or fixed amounts, or a mixture of both. The problem with this approach is that it doesn’t take into account any increase in the value of the property. So instead, you can say that after paying off the outstanding mortgage with the sale proceeds, you would get whatever percentage of the purchase price your original contribution to the cash deposit represented when you bought the property.

If you would like more advice on this, why not call us on 01606 74301.