Declaration of Trust & Deed of Trust
Declaration of Trust & Deed of Trust Introduction
When you are buying property with another individual it is crucial to think about having a Declaration of Trust (Trust Deed) drafted to legally protect your individual interests in the purchase. Please note this is not included as part of your Conveyancing Legal process which is why you need to give it great thought.
It is extremely helpful in protecting your asset if there is a dispute later down the line with the other property owner. Huge amounts of money are at stake when buying property, so protect your interest fully with your very own Declaration of Trust.
When is a Declaration of Trust needed?
- Record different shares/financial contributions to a purchase
- Multiple owners of property (friends, family or partners)
- One individual put more money into a purchase then the other
- A third party (relative/friend) invests money into a purchase
- A couple have children from different relationships
- You want to protect the money you have invested in a purchase
- Complications in a relationship (following purchase)
Property Vault have acted for a number of clients in drafting Declarations of Trust & with our assistance our clients have felt safe and secure in the knowledge that their asset is fully legally protected, should their be any dispute in the future with fellow co-owners. Should you require additional protection above that of the drafting process, we would discuss directly with the Land Registry to apply and implement the relevant Title Restriction on the legal Title in favour of the Declaration of Trust, to add increased protection.
Read on to view our FAQs on Declarations of Trust (Trust Deeds)
For further assistance do not hesitate to contact us:
01405 380 150
enquiries@property-vault.co.uk
What is a Declaration of Trust
A Declaration of Trust sometimes referred to as a Deed of Trust is a document which is legally binding on the parties to the deed. It specifically sets out who owns what shares in property, so this can be clearly documented and can be referred to at any time.
What types of property ownership are there?
Joint Tenants – Owning a property as ‘Joint Tenants’ means when one of the owners dies the property will fully (100%) become the sole ownership of the surviving remaining owner, this is known as the Survivorship Rule. The property will pass in this manner regardless of what the deceased party may have stipulated in their Will. For this kind of ownership, a Declaration of Trust is not required as both owners equally own 50% of the property each and when one dies the other owner will automatically gain the deceased share.
Tenants in Common (in equal / or unequal shares) – This type of ownership is the best option if one of the owners wants their share in the property to go to family upon their death, also if you are investing different amounts of money.
Other considerations
Owning a property as ‘Tenants in Common’ means when one of the owners die, that owners share in the property will fall under their Will and as such is distributed accordingly under the administration of the Will. This means if both owners decide to hold the property as ‘Joint Tenants in Equal Shares’ both owners equally own 50% of the property each, however when one dies that individuals 50% share will fall under their Will and be distributed accordingly. This method of ownership offers more protection for the owners share.
On the other hand, you may also hold the property as ‘Joint Tenants in Unequal Shares’ this simply means one owner may have a 20% share and the other an 80% share, the same applies in that when either of the parties die their share will fall to their Will.
How do I get started with a Declaration of Trust
These documents are very flexible to your requirements, first course of action is to ring Property Vault on the contact details shown at the bottom of the page. Whereby we can discuss your individual requirements, so we know exactly what needs to be covered in the deed.
Do I need a Lawyer to draft a Declaration of Trust
The simple answer is ‘no’. You may choose this option in order to save you money, however you may end up with more problems then you bargained for. For instance, the document may contain mistakes / errors that you were not aware of which may void the document and as such rendered it not recognised by jurisdiction and the court of law.
In term the price charged by Property Vault is a small price to pay, in comparison to the thousands of pounds you have invested into the property.
Property Vault will ensure that your investment (property purchase) will be well protected and secure for the future.
Can I do anything more than a Declaration of Trust to further protect my interest
Yes, Property Vault can discuss with you and draft the Declaration of Trust, however usually this document is not recorded upon the Title Deed and simply stands as a supplement to the Title.
However, should you require the Declaration of Trust to be included upon your property Title and as such be visibly apparent on your Property Register. Property Vault offers this service and we would discuss directly with the Land Registry to apply and implement the relevant Title Restriction in favour of the Declaration of Trust, to add increased protection.
I have already bought a property but not sure how me & my partner own it can this be checked?
Yes, We offer this service and can check this for you and advise on how you hold the property in relation to one another. This can be changed if you require.
Can I change how I hold a property after I have already bought it?
Yes, This service we offer and can amend the Property Title to reflect your preferred ownership. For example – if you hold the property as Joint Tenants and now want to own it as Tenants in Common, Property Vault can draft the necessary documentation required to ‘Sever the Joint Tenancy’ – see Severance of Joint Tenancy page.
Contact Us Today
To speak with one of our Qualified Property Experts, our team would be delighted to assist you.
Phone: 01405 380 150
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