1. What is a Declaration of Trust?
A Declaration of Trust is a legally binding document which protects a person’s interest in a property. It can detail the financial contributions and other arrangements of everyone who has an interest in the property. It can be a simple document or a document containing various provisions regulating the ownership of the property.
2. When might you need to consider having a Declaration of Trust?
A Declaration of Trust can safeguard against misunderstandings, disagreements, and people changing their minds which is important if you are buying a property with a friend or unmarried partner, or you and your partner are contributing different amounts to the property. If there is a dispute, the court will consider the Declaration of Trust as an indicator of people’s intentions.
3. At what stage should I get a Declaration of Trust?
It is recommended to have a Declaration of Trust prepared ahead of a completion of purchase, agreed and signed by all of the parties and then dated on completion.
4. What can be included in the Declaration of Trust?
Key pieces of information such as the contributions made to the deposit by each person, the agreement on contributions to mortgage repayments and outgoings and what each party will ultimately own will feature in the document. Beyond this, clauses can be included to cover a variety of eventualities that may occur – such as what would happen if a co-owner failed to pay their share of the mortgage, or if they want to sell their share of the property.
5. What else should you consider?
Alongside the Declaration of Trust, there are a number of legal documents to consider that will protect your interests and assets, including a co-habitation agreement and a Will. Without a Will, the share of the property upon death could transfer to relatives of the deceased instead of the other co-owner, even if that is not what the deceased had intended.
Would you like to know more?
Thrings’ Private Client Lawyers are experts in supporting individuals and families with a range of personal matters that are important to you. Whether it relates to a family business, land or private wealth, their expertise is there to help plan ahead in all areas ranging from succession planning and trusts to wealth management, Wills and probate.
