Declaration of Trust or Deed of Trust

A legal document that records how much money each person has contributed towards a property purchase, and what should happen to this money in the future.

People who buy property together, or who help a family member get on the property ladder, need to legally record what contribution has been made by each person. This can ensure that everyone gets back what they put in. Otherwise the investment could be lost.

What is a Declaration of Trust?

A Declaration of Trust, also known as a Deed of Trust, is a legal document that records how much money each person has contributed towards a property purchase, and what should happen to this money in the future. For more details see more information below.

What can a Declaration of Trust cover?

What’s included in a Declaration of Trust will depend on your individual circumstances, but it can cover things such as:

  • How much money each person has contributed towards the property purchase and other costs, such as maintenance and mortgage repayments
  • How and when each person will get their money back
  • What will happen to each person’s financial contribution if a current relationship breaks down
  • What will happen to each person’s financial contribution if the homeowner fails to keep up with mortgage repayments
  • What will happen to each person’s financial contribution if the homeowner gets married or has children
  • What will happen to each person’s financial contribution if the homeowner sells the property and buys another

What happens without a Declaration of Trust?

If you don’t have a Declaration of Trust, a Deed of Trust or any formal agreement in place, there won’t be a legal record of the contribution you have made, so you might not be able to get it back.

How much does a Declaration of Trust Cost?

Our Fixed Fee Declaration of Trust costs £900.

Once we have provided a written quote for the agreed work, that price will not change. As part of the Co-op Group, our values of openness, honesty, social responsibility and caring for others are core to the service we provide.

Included in the fixed fee:

  • Initial legal advice by consultation or detailed telephone call
  • Legal advice on the implications of signing a Declaration of Trust
  • Informing you of the information needed to create a Declaration of Trust
  • Drafting a Declaration of Trust to reflect the financial contribution you have made, and what should happen to this money should certain situations arise in the future.

Not included in the fixed fee:

  • Any negotiations if there is a disagreement (that work would be conducted on an hourly basis).

This fixed price Deed of Trust agreement is suitable for:

  • People who have bought a property together in England or Wales
  • People (other than the homeowners) who have contributed financially towards a property purchase in England or Wales
  • People who have already reached an agreement as to what should happen to the property (and any associated equity or debt) should certain circumstances arise in the future.

More information

Often a Declaration of Trust will be created by two people who are buying a property together as joint homeowners, particularly Tenants in Common. A Declaration of Trust will confirm what proportion of the property each person owns. Should there come a time when the property is sold, or one person wants their share back, the Declaration of Trust will provide a clear understanding of how much money should be repaid to each person.

Declarations of Trust are popular with parents who are helping a son or daughter get on the property ladder, by loaning them a lump sum or giving them money towards the deposit.

This is also becoming increasingly common as more people are getting financial help from family and friends when buying property. As such we often think of Declarations of Trust as ‘Family Agreements’, as they allow family members to set out how much money will be contributed and under what circumstances that money will be repaid.

Even if you’ve discussed all of these things and are in agreement as to how the money is to be repaid, it’s important to have a written legal document so that it eliminates any doubt. It also offers each person maximum security when it comes to getting their money back.

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About Co-op Legal Services

The family law team at Co-op Legal Services includes specialist Family Solicitors, Divorce Solicitors and Children Law Solicitors with Resolution accreditation and accredited experts in child abduction, co-habitation, domestic abuse, property disputes, high net worth money matters and financial advocacy.

Resolution is a national organisation of Family Lawyers committed to non-confrontational divorce, separation and other family problems.

Co-op Legal Services has over 600 staff working in different businesses with offices in Manchester, Bristol, Stratford-upon-Avon, Sheffield and London.

As part of the Co-op Group, our values of openness, honesty, social responsibility and caring for others are core to the service we provide.