Protecting Property Contributions with a Deed of Trust

When couples decide to buy a property together, it’s not uncommon for each person to contribute different amounts – especially when it comes to the deposit or ongoing mortgage repayments. Without a clear legal agreement, this can lead to confusion or disputes later on.

A Declaration of Trust (also known as a Deed of Trust) is a legal document that records each party’s financial contribution to a property and outlines how any proceeds should be divided in the future. At Beers Solicitors, we regularly help couples and co-buyers across Devon and Cornwall protect their investments and avoid costly misunderstandings.

What Is a Declaration of Trust?

A Declaration of Trust is a legally binding agreement that sets out the ownership shares and financial responsibilities of each party involved in a property purchase. It is particularly important when:

• One person contributes more to the deposit
• One party receives financial help from family (e.g. a gifted deposit)
• Monthly mortgage payments are split unequally
• The buyers are unmarried or cohabiting, and not in a civil partnership

The document ensures everyone’s interests are clearly recorded and legally protected.

Why Is It Important?

Without a Declaration of Trust, it is often assumed that all owners have equal rights to the property – regardless of how much each has paid. This can result in one person losing out financially if the relationship breaks down or the property is sold.

A properly drafted Declaration of Trust:

• Confirms individual contributions to the deposit or purchase price
• Outlines who pays what towards the mortgage and other costs
• Establishes a fair method of dividing proceeds if the property is sold
• Sets out what happens if one party wants to sell or move out

Real-Life Example: Unequal Deposits

For instance, one partner contributes £60,000 and the other £20,000 to the deposit. Without a Declaration of Trust, both may be seen as equal owners. With a Declaration, the person who paid more can legally protect that contribution and receive a proportionate share if the property is sold.

Do I Need a Declaration of Trust If I Have a Mortgage?

Yes. Most mortgage lenders accept a Declaration of Trust, provided it doesn’t contradict the terms of the mortgage agreement. Your solicitor will ensure that the document is correctly prepared and registered alongside the purchase.

Is It Only for Unmarried Couples?

Couples Contributing Different Amounts to a Property Purchase – How Can a Declaration of Trust Protect Their Contributions?
Protecting Property Contributions with a Deed of Trust

When couples decide to buy a property together, it’s not uncommon for each person to contribute different amounts – especially when it comes to the deposit or ongoing mortgage repayments. Without a clear legal agreement, this can lead to confusion or disputes later on.

A Declaration of Trust (also known as a Deed of Trust) is a legal document that records each party’s financial contribution to a property and outlines how any proceeds should be divided in the future. At Beers Solicitors, we regularly help couples and co-buyers across Devon and Cornwall protect their investments and avoid costly misunderstandings.

What Is a Declaration of Trust?

A Declaration of Trust is a legally binding agreement that sets out the ownership shares and financial responsibilities of each party involved in a property purchase. It is particularly important when:

• One person contributes more to the deposit
• One party receives financial help from family (e.g. a gifted deposit)
• Monthly mortgage payments are split unequally
• The buyers are unmarried or cohabiting, and not in a civil partnership

The document ensures everyone’s interests are clearly recorded and legally protected.

Why Is It Important?

Without a Declaration of Trust, it is often assumed that all owners have equal rights to the property – regardless of how much each has paid. This can result in one person losing out financially if the relationship breaks down or the property is sold.

A properly drafted Declaration of Trust:

• • Confirms individual contributions to the deposit or purchase price
  • Outlines who pays what towards the mortgage and other costs
  • Establishes a fair method of dividing proceeds if the property is sold
  • Sets out what happens if one party wants to sell or move out

Real-Life Example: Unequal Deposits

For instance, one partner contributes £60,000 and the other £20,000 to the deposit. Without a Declaration of Trust, both may be seen as equal owners. With a Declaration, the person who paid more can legally protect that contribution and receive a proportionate share if the property is sold.

Do I Need a Declaration of Trust If I Have a Mortgage?

Yes. Most mortgage lenders accept a Declaration of Trust, provided it doesn’t contradict the terms of the mortgage agreement. Your solicitor will ensure that the document is correctly prepared and registered alongside the purchase.

Is It Only for Unmarried Couples?

Not at all. A Declaration of Trust is commonly used by:

• Unmarried couples
• Friends or siblings buying a property together
• Parents helping children get on the property ladder
• Property investors entering into joint ownership
• Married couples who wish to confirm different ownership shares for tax purposes so that one party who might be a lower rate taxpayer receives the majority of the income
• Married couples can also use a Declaration of Trust if they want to keep assets separate.

Can a Declaration of Trust Be Updated?

Yes. If your financial circumstances change, the Declaration can be amended—especially if one party starts contributing more towards the mortgage or renovations. It’s advisable to review the document if your relationship status changes or if you have children.

Why Choose Beers Solicitors?

With offices in Kingsbridge and Plymouth, Beers Solicitors provides clear, practical advice on all aspects of property ownership, Declarations of Trust, and cohabitation agreements. Our experienced team will work alongside your conveyancer to ensure your interests are protected from day one.

Secure Your Property Investment Today

Don’t leave your financial contributions to chance. Whether you’re buying your first home with a partner or investing with family, a Declaration of Trust ensures your agreement is fair, transparent, and legally sound.

Contact our Private Client Team today to get started.
Kingsbridge Office – 01548 857000 | Plymouth Office – 01752 246000

Not at all. A Declaration of Trust is commonly used by:

• Unmarried couples
• Friends or siblings buying a property together
• Parents helping children get on the property ladder
• Property investors entering into joint ownership
• Married couples who wish to confirm different ownership shares for tax purposes so that one party who might be a lower rate taxpayer receives the majority of the income
• Married couples can also use a Declaration of Trust if they want to keep assets separate.

Can a Declaration of Trust Be Updated?

Yes. If your financial circumstances change, the Declaration can be amended—especially if one party starts contributing more towards the mortgage or renovations. It’s advisable to review the document if your relationship status changes or if you have children.

Why Choose Beers Solicitors?

With offices in Kingsbridge and Plymouth, Beers Solicitors provides clear, practical advice on all aspects of property ownership, Declarations of Trust, and cohabitation agreements. Our experienced team will work alongside your conveyancer to ensure your interests are protected from day one.

Secure Your Property Investment Today

Don’t leave your financial contributions to chance. Whether you’re buying your first home with a partner or investing with family, a Declaration of Trust ensures your agreement is fair, transparent, and legally sound.

Contact our Private Client Team today to get started.
Kingsbridge Office – 01548 857000 | Plymouth Office – 01752 246000