Specialist conveyancing articles to inform you about conveyancing for a house or a flat; whether you already own your own home or if you are buying one. These are free to read and written by specialists in this area.

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What is Shared Ownership Protection?

Andrew Boast

20/12/2017

Shared Ownership Protection is the leading co-ownership agreement on the market. You and anybody else who jointly owns your property with you create a document which is legally binding and notarised by a solicitor, and it sets down how you will own your property, from calculations of individual ownership share to any house rules you agree to abide by.

The document also sets down the procedure to follow if a joint owner wants to leave the arrangement and addresses other situations, for example what will happen if someone defaults on making agreed mortgage repayments. Shared Ownership Protection is commonly used when people are going into joint ownership and will be living together, however it is equally beneficial when people group together to buy to let a property.

Call 0333 344 3234 to ensure you protect your stake in a shared property.

Who is Shared Ownership Protection designed for?

It protects all would-be mortgage sharers, whether they are partners, friends or family. It combines both a Declaration of Trust as well as a Cohabitation Agreement.

The Declaration of Trust element is about setting down who owns what percentage of the property and takes into account how this can vary over time. You may, for example, have paid less deposit than a sharer but if you make greater monthly mortgage repayments than them, this should be recognised in a growth in your share of ownership the longer you choose to co-own your property.

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The Cohabitation Agreement sets down how co-owners will agree to live together and includes any House Rules which you agree together to help you live harmoniously. You might mutually agree, for example, that partners, children or pets can be brought into the household, or not, or whether smoking is to be permitted or not.

Once the Shared Ownership Protection (Joint Ownership Agreement) has been agreed and has been signed by all joint owners, you can't change it unless all signers agree and the document is duly notarised again. The document is material of relevance should a dispute goes as far as the courts.

Does it work differently for Buy to Let customers?

Buy to let joint owners will not be living together in the property so House Rules are not relevant to the document in this case. Instead, the Protection's Letting Rules cover all matters associated with tenants and renting which you and your joint owners have agreed. These can include matters such as New Tenancy Agreements, managing the property. monitoring of tenancy, how tenants are found and who conducts due diligence on them, who collects rent and how frequently rent is collected.

What if you and another joint owner can't agree Shared Ownership Protection terms?

We fully appreciate that buying a property with anyone is a serious matter so it follows that completing your Shared Ownership Protection is equally serious. You are in safe hands though: we've spent the time to work out numerous scenarios which might occur when people jointly own a property and the document has been fully checked and re-checked by many highly experienced lawyers.

Shared Ownership Protection is the best legal protection against things going wrong in the long run. The very act of planning the best ways to live harmoniously, making it crystal clear how ownership is calculated at any point, how anyone can leave the arrangement and completing a joint ownership agreement can only help increase your chances of happy co-ownership.

What if someone breaks the agreed House Rules?

We have created a Dispute Resolution Procedure, addressing this possibility, which you can find in the Protection document. We always encourage people to resolve any problems between themselves in the first instance.

The Dispute Resolution Procedure sets out a Dispute Resolution Letter in which joint owners can set out their dispute formally and request a meeting with joint owners involved to talk about any issues and attempt to solve them.

If joint owners cannot resolve a dispute, they have an Alternative Dispute Resolution Service to help them. The ADRS allows for any disputing party to ask SAM Conveyancing to appoint a solicitor trained in mediation to look at the facts of a dispute, allowing all sides to contribute material information for consideration. The solicitor then issues a written judgment which is final and binding on all parties in the dispute. The costs of the ADRS are borne by the joint owners in dispute.

Nothing can stop joint owners from taking each other to court to resolve a dispute, but we counsel against this if at all possible to avoid potentially exorbitant costs, stress and shattering relationships.

What does it cost?

An average cost for a Joint Ownership Agreement from a solicitor would range from £1,000 to £1,500; however Shared Ownership Protection costs from £240 (Incl VAT).

Basic Deed of Trust The basic deed of trust suits longer term relationships where the purpose is simply to note the joint owners’ separate shares of the property and what to do when the property sells. It isn’t suitable for shorter term relationships.	Silver Deed of Trust Best suited for couples or family who want to protect more than just their deposit contribution. While it addresses the beneficial ownership, it also focuses on what mortgage repayments you make, what contributions you put towards repairs and renovations during your ownership and procedures for what happens if you fail to keep up with mortgage/bill payments.	Gold Deed of Trust Best suited for friends or non-standard trusts requiring a bespoke drafting service. Includes a 1 hour call at the outset, the drafting of a bespoke deed of trust including bespoke clauses drafted by our legal advisor and then an hour call afterwards to run through how the deed works.
Standard Clauses Include:	Standard Clauses Include:	Optional Clauses:
Your deposit contribution is shown clearly and separately from those of other joint owners You agree the percentage share of any gain or loss on sale (this is fixed and doesn’t account for payments made during your joint ownership such as mortgage repayments or repairs/renovations) Lists Legal Owners & Non-Legal Owners *** Calculation for working out any gain or loss from rental income (if applicable) Mechanism for buying out any other party’s share of property Section for stating individual contributions towards outgoings Maintenance obligations All terms explained in simple English (read more here - Basic Deed of Trust)	Your deposit contribution is shown clearly and separately from those of other joint owners Our unique formula that calculates your share of any gain or loss in the property by taking into account your total investment including what you have added towards the initial deposit and your contributions towards mortgage repayments, the costs of buying and selling and repairs/renovations You can have Registered Legal Owners or Non-Registered Beneficial Owners (for example parents investing with children can be included in the Agreement)** Calculation for working out any gain or loss from rental income (if applicable) Mechanism for buying up a co-sharer’s interest in the property if they move out Section for stating individual contributions towards outgoings All terms explained in simple English PLUS Mechanisms to protect you if a joint owner stops paying their share of the mortgage Procedures to sell your share Procedures to deal with shock events such as death or a change in financial circumstances Procedures for dealing with property repair and/or renovation costs (including how to calculate any gain because of development and how it will be shared) Procedures to sub-let your share of the property Procedures to follow if the home sharing relationship breaks down Procedures to follow if you can't afford your mortgage repayments (read more here - Silver Shared Ownership Protection)	Your deposit contribution is shown clearly and separately from those of other joint owners Our unique formula that calculates your share of any gain or loss in the property by taking into account your total investment including your initial, contribution towards mortgage repayments, the costs of buying and selling and repairs/renovations. You can have Registered Legal Owners or Non-Registered Beneficial Owners (for example parents investing with children can be included in the Agreement)** Calculation for working out any gain or loss from rental income (if applicable) Mechanism for buying other party’s share of property Section for stating individual contributions towards outgoings Mechanisms to protect you if joint owner stops paying their share of the mortgage Procedures to sell your share Procedures to deal with shock events e.g. death or change in financial circumstances Procedures for property repair or renovation costs (including how to calculate any gain because of the development and how it will be shared) Procedures to sub-let your share of the property Procedures if the relationship breaks down Procedures if you can't afford your mortgage repayments Cohabitation house rules Inventory lists
£240 Inc VAT*	£349 Inc VAT*	£799 Inc VAT*

Basic Deed of Trust

The basic deed of trust suits longer term relationships where the purpose is simply to note the joint owners’ separate shares of the property and what to do when the property sells. It isn’t suitable for shorter term relationships.

Standard Clauses Include:

Your deposit contribution is shown clearly and separately from those of other joint owners
You agree the percentage share of any gain or loss on sale (this is fixed and doesn’t account for payments made during your joint ownership such as mortgage repayments or repairs/renovations)
Lists Legal Owners & Non-Legal Owners ***
Calculation for working out any gain or loss from rental income (if applicable)
Mechanism for buying out any other party’s share of property
Section for stating individual contributions towards outgoings
Maintenance obligations
All terms explained in simple English

(read more here - Basic Deed of Trust)

£240 Inc VAT*

Silver Deed of Trust

Best suited for couples or family who want to protect more than just their deposit contribution. While it addresses the beneficial ownership, it also focuses on what mortgage repayments you make, what contributions you put towards repairs and renovations during your ownership and procedures for what happens if you fail to keep up with mortgage/bill payments.

Standard Clauses Include:

Your deposit contribution is shown clearly and separately from those of other joint owners
Our unique formula that calculates your share of any gain or loss in the property by taking into account your total investment including what you have added towards the initial deposit and your contributions towards mortgage repayments, the costs of buying and selling and repairs/renovations
You can have Registered Legal Owners or Non-Registered Beneficial Owners (for example parents investing with children can be included in the Agreement)**
Calculation for working out any gain or loss from rental income (if applicable)
Mechanism for buying up a co-sharer’s interest in the property if they move out
Section for stating individual contributions towards outgoings
All terms explained in simple English

PLUS

Mechanisms to protect you if a joint owner stops paying their share of the mortgage
Procedures to sell your share
Procedures to deal with shock events such as death or a change in financial circumstances
Procedures for dealing with property repair and/or renovation costs (including how to calculate any gain because of development and how it will be shared)
Procedures to sub-let your share of the property
Procedures to follow if the home sharing relationship breaks down
Procedures to follow if you can't afford your mortgage repayments

£349 Inc VAT*

Gold Deed of Trust

Best suited for friends or non-standard trusts requiring a bespoke drafting service.

Includes a 1 hour call at the outset, the drafting of a bespoke deed of trust including bespoke clauses drafted by our legal advisor and then an hour call afterwards to run through how the deed works.

Standard Clauses Include:

Your deposit contribution is shown clearly and separately from those of other joint owners
Our unique formula that calculates your share of any gain or loss in the property by taking into account your total investment including your initial, contribution towards mortgage repayments, the costs of buying and selling and repairs/renovations.
You can have Registered Legal Owners or Non-Registered Beneficial Owners (for example parents investing with children can be included in the Agreement)**
Calculation for working out any gain or loss from rental income (if applicable)
Mechanism for buying other party’s share of property
Section for stating individual contributions towards outgoings
Mechanisms to protect you if joint owner stops paying their share of the mortgage
Procedures to sell your share
Procedures to deal with shock events e.g. death or change in financial circumstances
Procedures for property repair or renovation costs (including how to calculate any gain because of the development and how it will be shared)
Procedures to sub-let your share of the property
Procedures if the relationship breaks down
Procedures if you can't afford your mortgage repayments
Cohabitation house rules
Inventory lists