A Declaration of Trust, also known as a Deed of Trust, is a legally binding document which records the financial arrangements between joint owners of a property and anyone else who may have a financial interest in the property.
The purpose of a Declaration of Trust is for you to determine what happens to each person’s money. Even if the property is being held at the land registry (the legal title) in the name of one party, you can still have a declaration to confirm the shares of others who have an interest (known as a beneficial interest).
When is a Declaration of Trust required?
A Declaration of Trust should exist each time you buy a property with someone or with the help of someone unless all contributions to the purchase and going forward, will be equal. You should record differing contributions either to the purchase, with deposits and costs of buying or when you will be unequally contributing to the mortgage or outgoings for the property. It can set out how much each person is putting in and how much each person should get on sale. Having a Declaration of Trust avoids the uncertainty of what will happen when the property is sold or other circumstances arise, such as divorce or relationship breakdown.
A declaration is ideal to protect funds when one party’s family has provided finance for a deposit – whether as a gift or as a loan – and where contributions are not equal, which is often the case in real life.
Legal advice and assistance from experienced property solicitors
If you are looking for legal advice in relation to a Bank of Mum and Dad property purchase, guarantor mortgage, offset mortgage or Declaration of Trust, the solicitors at Wellers can help.
In fact, we can even assist in if you have already brought your property; a declaration can be enacted at any time, although it is best to have it completed as soon as possible. We can also help if you are considering gifting property to a family member.
Contact Wellers today
Our Declaration of Trust solicitors can help you consider all your options for dealing with your shares – for example, ways to protect the sums of money you or your family put in or the possibility of an increased percentage of ownership share to reflect the size of the initial investment.
Fill out our enquiry form and we will get back to you with legal advice and information that is specific to you and your long-term interests.