When two or more people buy a property together, a trust of land will automatically be created. A trust may also arise if somebody else contributes towards the purchase price, or even the maintenance costs, even if they are not named on the title deeds.
This trust of land could mean that this third party could make a claim on the property or the proceeds of its sale, despite their name not being on the deeds. This can obviously lead to costly disputes in some situations.
Conveyancing Executive, Mandy Johnson, explains that most disputes of this type could be avoided if a Declaration of Trust had been drawn up.
She says “At the outset, clients are confident that their relationship with their co-contributors will remain harmonious and often avoid having a Declaration of Trust drawn up, especially when they are already dealing with the costs and stress of buying a property. However nobody can predict the future and owners should approach this in the same way as home insurance – you hope that you will never need it, but safeguarding against the risks is cost-effective and safest approach.”
When somebody has contributed towards the property but is not named on the title deeds, it can be even more important to draw up a Declaration of Trust to protect their interest. A third party brings another potential avenue for a future dispute or uncertainty later on and a declaration of Trust helps to negate the risks and ensures that everybody is aware of the outcomes.
If you have any questions, please call 01202 499255 and Mandy or a member of her team will be happy to discuss any questions you may have.
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