We are currently living in a world where property prices are always on the rise, which means that many people are finding it difficult to purchase their own homes without the help of family and friends.
These days, many potential buyers are now seeking alternative means to ensure that they have a roof over their heads, whether that be by sharing a property with close friends, a romantic partner or even their own parents.
But what happens when multiple owners have a stake in a certain property?
Well, this is where a deed of trust can come into play, as these are legal documents that should be considered when multiple parties wish to lay claim to the same property.
Not only does a deed of trust establish what share of the property you own, but it can also be used in matters of finance and ownership, so if you are in a deed of trust and want to sell your current house, then you have come to the right place.
In the following article, we have collected some information concerning deeds of trust and how they can be used to sell your property.
So if you want to know more about what this document entails, then we have everything you need down below…
What Is A Deed Of Trust?
A deed of trust is a legally binding document that will be made at the time of buying a new property.
As a legal document, the deed of trust records the financial arrangements of everyone who is interested in purchasing the property, while also detailing the share of the property that they own and the procedures that have to be followed during certain eventualities.
For example, if a single owner wishes to leave the deed or the collective group wishes to sell the property to other buyers.
What Does A Deed Of Trust Do?
Beyond this, a deed of trust protects the interests of the multiple owners, ensuring that each party gets what they are entitled to depending on the sum of the initial investment.
If you and your fellow owners want to sell the property, then the deed of trust can also be used to determine the share that is legally yours.
However, if there is no deed of trust in place, then this can make the selling process extremely difficult, as it will be hard to ensure what each owner is entitled to after the property has been sold.
For this reason, deeds of trust are often recommended when sharing a property with friends and family, as they can be used to ensure the security of everyone’s interest.
There are many reasons why you should sign a deed of trust.
So to help you further understand the importance of this document, we have outlined some of these reasons in the section below:
Buying A House When Unmarried
If you have recently purchased a property with your romantic partner, then you may believe that you are cohabiting under a legal blanket called ‘a common law marriage’.
However, this is not actually true, as any couple who are not married or in a civil partnership are not afforded any legal protections, especially when compared to couples whose union has been recognized in the eyes of the law.
For this reason, there is no guarantee that either party will be treated equally in the case that the relationship should be terminated and the co-owned property gets placed in the hands of the legal system.
By signing a deed of trust, you can detail any unspecified entitlements, while also ensuring that each party receives an equivalent share should the property be sold to another buyer.
Protecting An Unnamed Resident
In our modern world, there are many reasons why a person may show interest in a property and contribute payments to its upkeep, even though their name is not on the mortgage or any other legal document.
For example, the person in question could have a low credit score or outstanding debts that make them ineligible to sign a new mortgage.
Beyond this, the person may reside in a property that is owned by another party, which is another case where a deed of trust could be beneficial for both investors.
By signing a deed of trust, you can ensure that you and the owner of the property receive the correct financial compensation, especially if you agree to sell the property to another interested party.
The deed can also be used to detail the exact nature of your living situation so that it can be recognized in a court of law.
Reducing Disagreement Risks
We all understand that a house is a very significant investment, which means that all parties who have a stake in the property should make sure that their funds are protected.
When buying a property, the Land Registry records will usually record the ownership of the house but not the specific proportions afforded to each owning party.
This means that when you are ready to sell the property, some stakeholders could find themselves receiving meagre shares without the correct legal documentation.
So by putting a deed of trust into action, you can ensure that you and your fellow trustees are clear about the shares and ownership, especially if an altercation leads to disagreements about how much money each party has invested.
Can You Sell A House With A Deed Of Trust?
The short and simple answer to this question is yes, you can sell a house with a deed of trust.
However, this does not mean that the process is very straightforward, as the decision to sell the property must be agreed upon as a collective.
This means that you will not be able to sell the house without the support of your fellow trustees.
However, if you still wish to sell the house as a single owner, then it is possible to buy the shares of your fellow trustees, which will give you sole ownership of the property and the right to sell it to an interested buyer.
But again, this can only be accomplished if your fellow trustees are willing to sell their shares and give you full dominion of the property.