We split the bills but not the mortgage. What can I do?

My partner and I split the bills but not the mortgage. Now I want to contribute to our loft extension - how can this be acknowledged legally?
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Question: I live with my partner in his house. He pays the mortgage but we both pay towards the running costs. We would like to extend the living room and loft, and I would like to contribute towards the cost. Is there anything we can do to acknowledge my contribution legally? 

Answer: You could transfer the property into your joint names using a transfer of equity. The equity in a property is the difference between its value and any loans secured on it. So, if the house is worth £400,000 and the mortgage is £300,000, the equity is £100,000. The transfer could be subject to the existing mortgage, in which case the lender's consent is required. Or you could take out a new mortgage and redeem the existing one.

You could hold the equitable title in specific shares known as a tenancy in common, and a declaration of trust could be prepared confirming the contributions you have each made and how the sale proceeds will be shared. Alternatively you may wish the legal title to remain in the name of your partner but have a declaration of trust showing how any sale proceeds are to be divided to reflect your financial contribution.

A restriction could be placed on the register of title at the Land Registry to prevent the property being sold without your knowledge and to protect your interest under the terms of the trust.

You could also consider a cohabitation agreement or you could treat your contribution towards the cost of the extensions as a loan secured by a second charge, but the consent of the lender may be necessary.

If you have a question for Fiona McNulty, please email legalsolutions@standard.co.uk or write to Legal Solutions, Homes & Property, London Evening Standard, 2 Derry Street, W8 5EE. We regret that questions cannot be answered individually but we will try to feature them here. Fiona McNulty is a partner in the residential property, farms and estates team at Withy King LLP (withyking.co.uk).

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