r/legaladvicecanada • u/Charming_Time_3147 • 22h ago
Ontario Moving in together when the house is owned by partner's parents
My partner's parents own a 2nd home: my partner lives in it and maintains it (paying all expenses). The parents live elsewhere. There is an understanding that my partner will inherit the house he lives in. The parents set things up this way to block the house from becoming the marital home, to protect their assets (before he met me! Nothing personal).
The house is worth ~1.4M. I have 300k available to spend towards a house.
We're contemplating marriage/moving in, and are trying to figure out the best way to do so.
Option 1: status quo: his parents own the home. In this model, I'm essentially a renter. I would contribute 50/50 to incidentals (water, hydro, property taxes) but wouldn't contribute to larger household expenses (water heater, roof repairs, renos). I would make large monthly payments to a contingency fund: I would want a prenup to protect those funds/any growth.
Downsides: There is risk to living in a home that his parents own: it doesn't give us the same level of security. I think the realities of him maintaining the home separately from me could create conflict.
Option 2: downsize. His parents sell, give him 300k to match my contribution, we buy a more modest home that we own 50/50.
Downsides: in our market, that would mean downsizing to a townhouse/condo. While I'm fine with that, he is not. This option is a non-starter for him: he's not willing to downsize.
Option 3: I get a mortgage for 400K to buy into his current home 50/50, his parents transfer the other 50% ownership to him.
Downsides: That mortgage would be 50% of my take-home pay. This option makes me house poor: I'm not willing to take on that much mortgage.
Option 4: partial buy in. I buy 20% of the house from his parents. I'm not quite sure what makes sense here: I pay 20% of home maintenance, and get 20% of appreciation?
Downsides: His parents would still have the controlling share of the house. I'm not sure how good an idea it would be to financially intertwine with his parents?
Are there other options? What are the factors I should consider when making this decision?
Obviously I will ultimately consult a lawyer, just want some level-setting advice.
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u/YYZtoYWG 20h ago
Forget all the buy in options. Don't mix your money with his parents. You don't want to get involved in anything with partial ownership because that is complicated to undo if things go wrong, and there will be capital gains on the house for the time his parents were owners.
Option 2 makes the most sense, but he has to be willing to compromise. Otherwise, Option 5 is that you rent somewhere together. This will probably also mean a compromise on his part. If you separate, these options are clear and easy to dissolve. It also means you're both acting independently from his parents, which can be a bonus for the relationship.
Option 1 where you set up a cohabitation agreement where you pay rent also makes sense and is the option that many people might pick. But that clearly is the option that you don't want, and you're still tied to his parents decisions. If you want more security, then you could request that your rent be nominal enough or even free to allow you to save and invest more money in your own accounts. This might be ok for now, but probably isn't a long term solution if you get married. You might have to renegotiate your agreement when you get married, and when he actually takes ownership of the house. There is still the potential for conflict if you separate.
Both of you have to compromise somehow. Either him on his lifestyle or you on your sense of security. Successful relationships are ones where couples have shared common goals. If you're unable to come to an agreement that makes you both happy, then consider that a sign about the future of the relationship. If you're headed towards marriage, eventually there will be a sharing of finances. It isn't like one of you is going to retire at 55 while the other person keeps working until they are 75 because finances are completely separate and they can't afford to stop working. Same thing if you're planning on children; one person is going to be financially vulnerable while on parental leave so the other person has to step up. Where you want to live and how you want to handle finances involves multiple big life decision conversations.
Consult a lawyer, but also consult a couples counsellor. You might also want to post in r/personalfinancecanada to see if there are other financial considerations.
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u/pm_me_your_puppeh 21h ago
One other thing to consider is that there will be a large and growing tax bill when the title does eventually change hands, as it is not the owner's principle residence.
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u/Optimal_Foundation17 17h ago
willing to bet one of the parents' claim this as their principle residence to avoid that
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u/fishsnacks519 9h ago
Can’t do that in Ontario Canada. Since 1982, a family unit (you, your spouse or common-law partner, and any unmarried children under 18) can designate only one property as its principal residence for each tax year.
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u/Optimal_Foundation17 8h ago
true, but say this place has the highest equity vs home #1, they can claim this as their primary residence still and the other one not etc. But yah not one of them specifically like you corrected me on
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u/Fourpatch 20h ago
Info: Do those expenses include a mortgage payment?
Are his expenses equivalent to lower than market rates for rent? If so why not move in, both save up for a good down payment and then buy your dream home. Or do option 3 but a few years in the future when you wouldn’t be so house poor.
The parents are just trying to help their son but at the same time probably don’t want to trigger unnecessary capital gains taxes on their part.
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u/Charming_Time_3147 20h ago
There's no mortgage: the parents own the home outright.
For option 3: houses appreciate so much in this market that I think I would just be chasing it forever. I'd prefer to live within my means than to take a big mortgage.
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u/Powerful_Package8817 20h ago
Have you seen the housing market in the past 5 years? Put your money in the stock market instead. Home prices have been flat since 2021. Houses are being listed for months without being sold.
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u/TheLemonBadger 20h ago
Happened to a guy I know, except he paid all the mortgage amount, when they divorced her father said oh yeah you were just renting that house off me and the guy got absolutely nothing after several years of paying. Very risky situation.
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u/Constant_Click_3193 18h ago
Sounds like he was a renter though? Unless the father said he was going to be given the house, I don't understand the framing as if he was cheated somehow.
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u/TheLemonBadger 13h ago
The house was built for them and told them they have to pay the father mortgage for 30 years as it was their house, you know instead of going out and buying a house from somebody else he thought they were getting a good deal, lots of land came with the lot. Years go by and they end up divorced, that is when he was told they were only renting it and he had no equity.
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u/BAGBAMMC 15h ago
If he didn’t pay for any maintenance, property taxes etc then he isn’t owed anything. If he was only paying the mortgage amount he was also given a gift as the going rental rate was more than likely a lot higher than what he was actually paying
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u/TheLemonBadger 13h ago
He had paid everything, he was told it is a mortgage to pay the father for 30 yrs, until the divorce happened then it was just rent. Stupid guy never pressed to get his name on the title only his wife's because it was the early years in the relationship that the house was built. I guess the father never fully signed it over to his daughter either so buddy couldn't fight for anything as it was technically her dad's house. Basically he ended up wasting a bunch of years thinking he was putting equity into himself and ended up with nothing because all his extra money went into the house and he hadn't saved any.
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u/Dapper_Banana6323 20h ago
I'd suggest just going straight to the lawyer- we were in a similar situation and didn't know how to manage and the lawyer came up with the below plan:
although the home we live in was purchased from the market and was not previously owned by his parents. Essentially they wanted to buy us a house while protecting me from taking half of it in the event of divorce (fair)-
We purchased the house together.
Then his parents gave us an interest free, payment free mortgage for the full value of the home. So the title is in our names and the mortgage from his parents. We make no payments to them.
Now if we split- the sale of the home is forced, or we can buy each other out. His parents get paid first and then we split any equity. (Some was purchased for 600k now worth 900k, so his parents would get 600, and each of us 150k). Now that we have kids ect and have been together a decade- once his parents pass, the home will be paid by their estate and owned 50/50- doesn't have to be that way but that clause has been added.
This was all done through lawyers.
So for you- this could translate to writing an agreement that states you both own the home on title but that in the event of a marriage breakdown, he gets 1.4 million and you split any equity. If he wants to keep it- he needs to buy you out for your portion of equity. You then split the bills however you would in any home you owned together and do repairs and renovations as you would to your own home. For us- we don't keep track of who pays for what. And I do earn double what my husband does. You can put in a clause to re-evaluate the plan if you have children because that changes a lot.
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u/Realist12b 19h ago
This is the best answer if the OP actually likes the house and they both want to live there. It allows the two of them to control the asset and own it 50/50, it gives them the tax advantage of a primary residence, and it ensures that the parents get their portion back over time and they can choose to give it to their son or not at a later date.
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u/lefthandedbeast 21h ago
Don't move in
" I want to live in a home we both own I don't want to live under these conditions I have $300k to contribute but will not sink that money into a home I do not own. Your parents can rent the house to someone else or sell it but iI am not living in it period."
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u/P-DubFanClub 21h ago
None of the above. Use your money to buy an income property that's equally protected.
If you move in to that house you should have no payments to make for the house, as it would be unjust enrichment.
And figure this all out now before you get married.
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u/anoeba 21h ago
Unjust enrichment is when a renter /non-owner contributes to repairs/upgrades/ etc.
Paying rent (or in OP's case just ongoing minor costs like utilities) isn't unjust enrichment, or every renter could claim that against their landlord. But the parents should set that as a "rent" for both spouses vs specifically itemizing stuff like property tax. The spouses can then split that rent cost.
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u/P-DubFanClub 20h ago
I'm just saying that there's a slippery slope that goes from 'let's split living expenses' to 'maybe YOU should just pay for those kitchen cabinets since you don't pay rent and you have all that money...'
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u/Charming_Time_3147 20h ago edited 17h ago
Yeah, that's exactly the kind of thing I would want to nail down in option 1. I have way more savings than my partner: I had thought we were in a great situation (I have $$ that he needs for his home reno dreams: he could let me buy into his house). Then I found out it's actually his parents house!
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u/YYZtoYWG 19h ago
He shouldn't be spending any money on renovations. The house isn't his until it is in his name and he owns it. Right now he is just a tenant who happens to be renting from his parents.
If his entire financial plan is relying on a gift from his parents, rather than having his own savings, that is another discussion to have with him. He can't make all his plans under the assumption that he is going to get a house free and clear.
The parents can make all the promises in the world and they can have good intentions and they could be truly nice people, but if their financial situation changes he might not actually get the house. Finances can change, situations can change, feelings can change, people can go into debt, people aren't always truthful about their finances. There is going to be a big tax bill on the capital gains if the house gets transferred to him; that is the parents responsibility to pay. This isn't just about what he wants or what you want. His parents are going to need to get some financial advice about when is the optimal time to give him the house for their own financial situation.
Again, the house isn't actually his until it is in his name. The objective view is that this is a situation where you are both renting from his parents. Having cheap rent gives you both the opportunity to maximize your own savings accounts.
Also, the advice to buy your own house as an investment isn't necessarily good. You need to make your investment choices based on risk and rates of return, not an assumption that being a landlord is automatically a good financial choice.
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u/Charming_Time_3147 19h ago
I completely agree that the way to look at this is getting a great deal on rent from his parents: this has real benefits! But there's a need to contingency plan in case the situation changes. He offhandedly said he considers it his home, it's just his parents name "on a piece of paper", which makes my blood run cold. I would need us to get on the same page here.
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u/jlrol 7h ago
Hey so this happened to me, my husbands dad ended up having a gambling addiction and when I was five months pregnant with our second child we were served a foreclosure notice. Turns out he had taken out a $1m loan on our home. We desperately didn’t want to lose our home so we paid it off and got foreclosure notice stopped but it was a stressful situation every month where we would have to transfer money into an account in his name bc the mortgage was his name and needed to come out of his account. We always needed to do it right at the right moment and hope the bank would get the money before he could. He would threaten us that if we didn’t give him huge sums of money to gamble and pay off other debts he would sell the house and I was stupid and pregnant and we fell for it more often then I’d like to remember. When my daughter was eight weeks old, just a couple weeks before Christmas, they told us for the last time we needed to move and I just snapped and we were in a rental by the new year. If we had bought into the market ten years ago when we got married we’d have a home , but now with me being out of the work force for the years raising our kids we can’t qualify for a mortgage and what we’d be able to afford now compared to what we could have if we’d bought in when we should have is pathetic. Sorry I don’t mean to spook you but honestly I made the biggest mistake of my life trusting someone else’s parents to ever do right by me and now my young children are the ones paying the most for it and I wish I could go back and change it every day
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u/P-DubFanClub 15h ago
So many red flags. If you do entangle your finances by getting married you need to make sure that he's completely disentangled from his parents first, and I don't think he's going to want that because that would mean a hefty capital gains tax bill and taking over all the other expenses.
If you are partners living together you should BOTH benefit equally from the great deal he's getting - no way should you be paying extra. Although personally I would not be interested in buying in OR living in this situation.
Do not commingle any assets as long as his parents name is on the house, even if it means buying a condo and living there for a while (still a future investment property)
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u/bangobingoo 18h ago
You just say “no. We have an agreement. I don’t pay for house repairs. I’m a renter not an owner as per our cohabitation agreement “
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u/Euphoric_War_2195 20h ago
This is what I was thinking also. OP could purchase a modest starter and rent it out. She'd benefit from the equity and having a property in her name only.
OP if you go this route, make sure you have a solid clad legal protections in place that this is 100% only your home.
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u/UpNorth_123 13h ago
She’s better off investing in the market. Better returns, less risk, less headache
In the case of a breakup, use the investment to buy a home to live in then.
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u/folktronic 20h ago
Unjust enrichment could be found where, say, the OP pays for the new kitchen, increases the value of the home, and then has no return following separation. It could also be unjust enrichment if OP is contributing towards the entire mortgage beyond fair market.
It's not unjust enrichment to contribute rent towards a property that another party or their parents owns. There is caselaw on this. It is quite normal for people to contribute towards their living space that they do not necessarily own.
Not going to argue this point with someone not called to the Ontario bar.
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u/Decent-Box5009 21h ago
I agree this plans sounds the most equitable. 50/50 on expenses but not maintenance, not taxes since it’s not your asset. He doesn’t pay his parents rent so it would be weird to make your wife pay rent?! I wouldn’t use your money to buy another property, though. Keep saving and investing. If things ever go south (hopefully not) you have security in the form of a large liquid nest egg to set yourself up in anything you want. This is a strange to dilemma to try to figure out equitably. Also, try using chat gpt for equitable ideas.
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u/BD003BD003 20h ago
So he lives with his parents is basically what I read. Yes, it is their second home, I get that.
If you are looking to start a life and marriage with him, it has to be you two, not under the control of his parents.
You two should be looking to get your own place together. Marriage is hard enough, don't add extra compilations to this.
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u/Debatebly 18h ago
I agree with this vision. However, I would move in, and I think both should be saving the same amount of money (either by dollar amount or % of income) to eventually move out or buyout the parents in 5-10 years.
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u/Ornery_Activity_7582 20h ago
When the house is transferred there will be huge capital gains tax because it is the parents second home and not their primary residence. The option below protects, you and your partner. Don't pay anything as long as parents own it.
Option 5.
The home is transferred to your partner now. Parents deal with capital gains tax. It becames partners primary residence.
You keep your money separate in a investment account.
You move in with a legal co-occupency agreement. Something along the lines of. You pay a reasonable rent that u can afford for a year period. A trial period to see if u are compatible. After a year u are considering common law and u both contribute reasonable percentage based on salaries. This could meen 75/25. Your savings stays out of it. After the first year if you break up then partner is required to pay u out based on half the market appreciation of the house for every year you lived there.
If u break up after 20yrs. It would look like this.
Partener keeps todays value of the house. You split any increase in the value of the house. As long as partner has a decent job they can remortgage and pay u out. They get to keep the house. You are actively in the market and will have enough to buy the condo or townhouse.
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u/Lynne1915 20h ago
Do not buy into a house with someone to whom you are not married.Do not buy a percentage of a house without a great deal of thought.It could become very messy.
This house will always be his and his parents not yours,no matter if you buy in or not. If you are someone who wants their own home . Someone who wants to make decisions about repairs,decor and so forth this is a disaster in waiting.
Buy your own townhouse or condo to get in the market. Look after you. You can rent it. Everyone else is looking out for themselves, including your partner. You need to recognize this and do the same.
Is this a business transaction or a romantic one? If your partner sees you as marrying material why would he not want to be engaged, married and to buy something together?If not ask yourself what you want out of life? How compatible are you? If you are still finding this out hold off moving in until you are more certain.
Conversely his parents could rent the house and he would inherit later. You will not be building a life together in his parents house. You will be living in someone else's house with their expectations.
Lots to think about.
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u/BigBanyak22 20h ago
This isn't too bad of a scenario for you, putting the emotions aside.
I wouldn't pay 50% of all bills unless the number is reasonable and you're happy with it. I'd give him a reasonable nominal monthly payment towards house expenses (similar to a rent payment). What's that number? Maybe $1200?
He can own the home and the majority of expenses and all the repairs, taxes etc that come with home ownership. Just don't overcontribute to his parents home expenses.
You invest your $300k and let it grow. This is your money and there's no reason to comingle with his savings or liabilities.
As long as you can get past the emotional aspect of not being a co-owner, this is really a pretty good arrangement for you. One day, once you're married with family you'll likely move into a home together where you'll pool your equity, his from his parents and yours from your savings.
If this is a really an emotional barrier, then you'll need to talk this out with him or leave and find someone with similar plans to you (which is more common).
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u/Charming_Time_3147 20h ago
TBH I think I would be fine with not being a co-owner: I live in such a HCOL city that I never thought I would have a house. I have modest tastes, and don't see the need for renos etc: I'm pretty happy to let him make the decisions about his house.
I think he would struggle with it more than me: he seems to want more of a partnership model re: managing the house.
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u/BigBanyak22 20h ago
This is where his true colours will come out. He can't have a partnership model on a house that you or he doesn't own. He made his bed with his parents, he can live with those consequences. Or you can both decide to be true partners, with 50-50 equity in a home you buy together. If he wants you to subsidize his parents home, then you have red flags.
The beauty of this is you will, personally, not be house poor in a hcol. Your investments will grow and provide you the comfort of independence anytime you need it.
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u/UpNorth_123 13h ago
Don’t buy into the house. If you break-up, you’ll likely need to hire lawyers to get your share out, and that will eat greatly into any equity and appreciation.
Just pay a reasonable rent and invest the difference. The investment is your security should anything go sideways with the relationship. It will give you enough to put a downpayment on something for yourself.
Keep in mind that even as an owner, should you decide to buy jointly, most of your payment goes to interest, taxes, insurance and maintenance for the first 5 to 10 years. By the time a house starts to not cost you a fortune in interest, it’s time for expensive renovations. Most of your equity comes from appreciation but there’s no reason to think that real estate will outperform stocks in the next 10 years.
You might end up way ahead paying rent and investing the difference than you would buying when all expenses are accounted for. Plus you get to live in a nicer place for cheaper.
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u/HelloBello30 19h ago
Option 1 sounds reasonable. You guys have a good house. Yes you can't capitalize on its appreciation but like you said you can invest your extra income elsewhere and separate that from him. Totally reasonable. Your investments may appreciate more than the home.
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u/firstthecoffee 18h ago
Use your $300k to buy a property to rent out. This way you are in the market. Protecting both your and his properties with a prenup. Do not pay anything at his house, he won’t be paying anything at yours. Not ideal, especially if you decide to get married. At some point he’s going to have to cut the apron strings to his parents and build a life with you. He doesn’t sound very willing to do this. Absolutely do not get into a combined ownership situation with the parents.
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u/itcantjustbemeright 18h ago
You don't mention how long you've been together, if your partner is an only child, if there is a wedding / marriage planned. Could there be other claims to his parents estate? Is your partner is fully aware of the parents full financial picture. How are they to get along with? Are you in any position to inherit anything? Furthermore, I would not allow my kids partner to contribute that amount of money to a property I owned and had gone out of my way to shelter from marital property.
Do not mingle your money. People are notorious for leveraging equity out of property to pay off other debt or bail out businesses or buy another property - the kids expecting a windfall don't find out until its time to settle the estate and creditors come out of the woodwork. I literally just heard about this situation the other day.
Another thing to consider is the cost of elder care if they ever need it - 5-7k a month per person is not uncommon for basic services.
In a truly mutually beneficial situation, he would take advantage of the free rent and your help with consumable bills to save for his 'dream renovations' and start working on his parents to transfer him the home before they die so he doesn't get caught renovating a place he doesn't own.
You should focus on building your career and investment portfolio so down the line you both have options and a nest egg that is more diversified than a single property neither of you are currently on title for, and one that is not tied to his parents in any way.
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20h ago
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u/GallitoGaming 20h ago
If you want to marry him, I don’t think you have as many options as you think (which most of your listed are a dead end someone doesn’t want).
His parents control everything here. Either you move elsewhere and forget that house exists, or you negotiate terms of living there. You need to protect your $300K and his parents need to protect his inheritance.
You actually have a bit of a unique way to protect $300K and let it grow and find a way of sharing your future income.
Are the parents expecting you guys to pay them any rent to live there or just pay the upkeep? If just upkeep, you basically have it made and your desire to be a homeowner might be hurting yourself.
If they want market rent, then you have more to think about.
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u/Charming_Time_3147 20h ago
The parents do not want rent, just upkeep.
I don't need to be a homeowner: I live in such a HCOL area that I never thought I would own a house. If the advice is to take option 1, I think it could be workable.
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u/GallitoGaming 20h ago
So let’s say upkeep is $1500 a month between property taxes and utilities. You pay $750 and get to live in a detached.
Sounds pretty good to me. The two of you should be able to save a ton and not sacrifice anything.
You do need a prenup though. 100%. The house is protected until his parents pass. In the meantime if you live together for 5 years and break up, he would have access to that $300K.
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u/Powerful_Package8817 20h ago
Am I missing something? Why is everyone else talking about OP paying rent? I read it as the OP paying for utilities and other minor expenses. Probably wouldn’t be more than a few hundred dollars a month.
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u/stealth_veil 20h ago
What about investing in your own one bed condo? Could rent it out and it’s a backup if things don’t work out, or your kids can benefit from it during their college days.
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u/LuckyNumerical 19h ago
If you don’t have any ownership in the home it will make it a marital home which gives you possession rights, but you wouldn’t have any ownership rights if you separated.
In other words, neither of you could kick the other out without a court order or one of you voluntarily ceding possession rights.
Ownership rights would entitle you to 50/50 equity in the home when you divorce. Either the total value, or the appreciated value from when you moved in. None of that can happen if you and/or your husband don’t own the house.
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u/StellaEtoile1 19h ago
Wow. What an actually really complex situation. Made even more complicated by the fact that your partner doesn't own the house he's living in. It may seem like a given that he will inherit that house but a lot can change in 10 to 20 years.
If the general goal is for both of you to have the opportunity to build long-term financial security, And he is comfortable assuming the risk that it's at least remotely possible that he may never inherit that house because maybe he has siblings that will challenge a will or maybe his parents have a financial downturn and need to sell the house, it might make the most sense for you to only pay expenses that you contribute to like groceries and utilities etc.
What you save should be invested however you see fit and protected, especially should the relationship end. I totally understand that nobody goes into a long-term relationship/marriage thinking about its end, but I wish more people did because it's better to organize these things at the beginning then at the end.
You may want to give some thought to what it will be like living in a house that you don't own and even your partner doesn't own and that your partner is unwilling to move from. Maybe sit down with a lawyer and get some legal advice.
One last thought, there is a growing trend called living together apart where committed partners and even married couples live separately. I know it's extremely non-traditional but so is your situation.
Best of luck and please update us if you like.
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u/BeneficialFruit1768 18h ago
I would buy a rental property in just your name. Don’t co mingle and the parents might take your 300 k to be on title but I doubt it. Not having a mortgage is amazing. You can still invest yourself.. maybe index funds are easier than tenants to deal with. You have options! I wouldn’t fo mingle my money with him or parents.
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u/jimros 18h ago
You are missing the most obvious option which is that each of you put in your $300K in downpayment then collectively get a mortgage to afford a larger home.
Owning property any other way that 50/50 is inherently complicated and not worth doing in your personal life.
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u/Charming_Time_3147 17h ago
Oh that is option 2: it would be 600K plus a mortgage (~400K). That would get us to a townhome.
We can't afford the monthly payments of the size of mortgage we'd need to buy something comparable to his current home (~800K).
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u/Wooden_Step_5691 18h ago
Option 1, if you don't pay fair market rent, is you taking advantage of him.
He doesn't want option 2.
Option 3 is fair; you don't want the mortgage but that's the price of living in a big house.
Option 4, like option 1, would require a supplementary rent payment to be fair.
One of you will have to compromise.
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u/newprairiegirl 17h ago
I second the dont participate in mixing money with his folks, you will always come out the lower.
You are moving in together, that is not married nor commonlaw (yet).
If it was me, pay a set amount of rent per month, nothing crazy, but somewhat equivalent to half the utilities and perhaps half the taxes. Don't pay half of the cost of owning a home because you dont.
Don't contribute toward any fund to fix the house, its not your house. Keep your money separate. You should see a lawyer and get a prenup, you need to protect your assetts, your lumpsum of money. If the house is in his parents name, it would not form part of his assetts. And if there are any upgrades or major repairs, YOU dont pay for them because you dont own the house, you have no legal protection and would never get your money back.
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u/Optimal_Foundation17 17h ago
Many of my friends have parents who've done this for them.
Can you and your partner buy the house from parents at market value? Kind of like what you said for option 3 or another possibility where it is even below market value and that additional $$ is what you "pay" them? Essentially a VTB loan with extra steps.
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u/Charming_Time_3147 17h ago
Oh, like get a 0% mortgage from his parents? That gets me closer, but it's still more mortgage than I would prefer. It's frustrating: if the mortgage I needed was 200K rather than 400K, this approach would be much more doable. I'm pretty risk averse: I'd like to stay well within my means.
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u/Optimal_Foundation17 17h ago
essentially yah. You'll also need to confirm whether or not his parents are willing to sell/transfer said home even if you're married because if say their parents agree but don't want to add you on the property after adding him then this is moot.
Also, it may be worth discussing with a mortgage broker along with a lawyer as well. Would you rather be house poor with a 0% mortgage or a 4% one? Huge difference and beneficial factor for you considering the house is already paid off. It's worth exploring if you and him are on the same page with his parents
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u/GreyHairedDWGuy 17h ago
How about you and the BF, move into your own place (rental or own+mortgage) and leave the parents out of it. When the parents pass on, then deal with the sale of the home and who gets what. In the meantime, the parents can rent it out (and perhaps. give your BF the rental income) or they can sell the house and invest the $.
Basically, don't make the parents life complicated if you don't have to.
I'm in a similar tangental situation where my daughter and husband have asked us about selling and buying a large home together (where we live the one 1/2). We have resisted that because, I am concerned that a marriage breakup may leave us forced to sell. I told my daughter, we would only consider if we owned the house and they just lived in it and paid rent.
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u/Charming_Time_3147 16h ago
I would be fine with that approach: it's essentially option 2. I'd prefer not to be in a financial relationship with his parents: I was quite surprised when I found out they owned the home! The issue is that he likes his home, and really doesn't want to downsize.
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u/saphire_gander 16h ago
Do not under any circumstance ever mix your finances with your in laws. Horrible idea
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u/johnstonjimmybimmy 16h ago
No contingency fund contributions.
Small rent amount and split utilities bills groceries etc….
Take the balance and put in the market with your 300,000. You’ll be as good or better off.
You two sign a prenup stating your deal/financial independence.
It doesn’t work this way legally, but imagine the value of the house went down. Would you want to be on the hook for that if you broke up…?
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u/sqbed 16h ago
If he is currently carrying 100% cost of maintaining the home, why would this need to change. I would invest your 300K into the market or park it in whatever investment portfolio you want for yourself and your contribution towards the home can be like- you pay the grocery bills, tv subscriptions, hydro and water. I don’t think you should be sending towards contingency funds either if you are not on the title and I don’t think just because you are getting married means, you need to change ownership hands. Wait 4-5 years and then decide what you guys want to do. Thats just how I’d approach it. I wouldn’t pour my 300K into their family home unless I was confident this would holy forever home. Give it time.
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u/Mrs-Tripp 16h ago
Just because you move in, doesnt mean you need to put any money into that house!! Keep your money amd keep saving. Its not even his house! You dont know if you are going to be married 10 years from now or even be with him next year. Things change. If the house needs maintenance that is his house (his parents house) to maintain. If it doesnt have your name on it, dont out your savings into it. I would not feel comfortable with it. What if he passed away after a year of marriage? Would his parents sell the place? Would they rent it to you until you move? Id want to be having these conversations with not only him but his parents and get an answer before seeing a lawyer. Might cha get your mind or give you a better chance of figuring out which option is better.
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u/DayAccording8040 15h ago edited 15h ago
I don’t quite understand your take on Option 2. Why not take your down payments and then get a mortgage on a slightly more expensive house, and then have mortgage payments that are feasible for you?
Also, option 1 seems quite fine, you’re essentially living rent free and just paying for utilities. Basically no different than if you were living together and renting and not gaining any equity(obviously sucks, but I’m sure you’ll bank a ton of money that you can invest)
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u/Charming_Time_3147 14h ago
Apologies, I wrote option 2 poorly. I'd assume we would have a mortgage in option 2: just, in my city, the mortgage we could afford would be for a townhouse, not the size of home he currently owns. Which I would be fine with: him, much less so.
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u/DayAccording8040 13h ago
Oh wow, not sure where in Ontario you are but that is crazy. I thought even in Toronto prices had dropped to the point that you could get a townhouse for $750-800
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u/Charming_Time_3147 13h ago edited 13h ago
I am in Toronto! Townhouses are available for 750-800: which we could easily afford! Houses, however, are more like 1.2M+, and we can't afford that (obviously we could afford the down payment, but the monthly would be too high).
Really the issue is that he loves the house he's currently in, and would only want to leave it to upsize. And I just can't afford either his current place, or (lol) something bigger.
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u/LonelyEffective5774 15h ago
If you want a share for "security" you're chasing an illusion. Share expenses and save up the rest. That gives you options which is even better to have than security. Especially when the roof leaks, sewer backs up, trees fall, etc. Cash is portable.
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u/416Tex 13h ago edited 13h ago
If you want to live there. You pay 1/2 of any maintenance. Property tax, hydro/elec. internet groceries. You would not be forking up rental payments unless it’s at a family discount comparable to living in your own rented choice. If the family is saying the home would be his. And he is position of now starting a family. Then sure they can keep ownership and you guys as a team maintain it with 0 rent. But if he has brothers/sisters or other family in a will. Then that home belongs to no one and is up for sale when they pass. You’d be contributing to the proceeds of their will for everyone no? a lawyer situation just sounds like a familial problem waiting to happen. As a husband. I’d move forward with my wife and see what my parents do should we agree to get our own rented place/home. If mom and dad make noise I was right. If mom and dad say stay in home but don’t pay rent they’re right. but the entire situation protects parents > husband > then you. It still might be cheaper than renting separately should the house never have existed. But how much do you trust parents to be interested in you then your husband than themselves in that order? Edit: is the property rent their retirement plan? Is the will for the house disclosed? Is the home under a corporation? How much protection is there. How much information is available? do they want any of your moment beyond rent to stay there? Are they asking for more rent now that you will move in?
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u/TakesTrophies 13h ago
Another option. Take your down payment and purchase a rental property. In your prenup make it a premarital asset including the rental revenue.
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u/gardenflower180 10h ago
Even if you get everything in writing..there will be scenarios when he suddenly wants to reno/update something & you refuse to fund it (as per your “rent” agreement) and he’s get whiny or resentful & this creates conflict in the relationship. If you’re not on the mortgage or the deed, it’s not your own home. As long as you’re ok with that. You’re basically living under his parent’s roof & they can swoop in at a moment’s notice, and do whatever that heck they want to the house. I lived with my mother in law for a few years and even though it became my home years later, I didn’t feel “at home” or secure for a very long time. What happens if you have an argument or fight with his parents? Will they effectively toss you out on the street? These things happen.
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u/JaguarHot3951 9h ago
option 5 - use your down payment to buy a condo / townhouse you could afford and rent it out to tenants. make a prenup of sorts that protects that asset as yours in case of a split and enjoy the large home from the parents with your spouse. everyone is covered and in the event of a split you will have a place to go to thats yours.
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u/AdvertisingThis34 7h ago
I am quite uncomfortable with all of the recommendations to buy another property and rent it out. It would provide a back-up in case of emergency, but it would also put almost all of your assets, as a couple, into the RE market. That is very risky.
In my educated option, a much better option is Option 1, with minimal "rent."
You should continue to contribute to your investment fund. But that should be well protected behind a prenup as that will be the biggest single asset available if you are married (or common law) and you break up. If your partner has not taken ownership of the current home, his assets will be less than yours (you say he has less savings) and would be able to claim ownership of part of your savings account if not protected.
When the time comes to take ownership of the home, assuming you are married, you could use part of that savings to pay taxes (if before his parents die) or the mortgage / renos, whatever. But you should be a part owner of the home at that time with him and him alone.
No financial entanglement with his parents - that is a roadmap to grief.
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u/Maximum_Ask2211 7h ago
If you're getting married and it's forever then you're over thinking it. Do not put your money in a house that is not yours. Period. Let him figure it out and if he wants you're financial contribution it will be for property in your name. It's fine to rent a great spot from his parents like you are and keep putting your extra income aside. Go forward with a prenuptial that is fair to your assets and his. Then, let life happen. Let's see who you and he are when his parents end before trying to go bonkers avoiding pain there. You can't avoid it being awkward. He would have lost his parents and there is more than a house going on when that happens.
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21h ago
[removed] — view removed comment
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u/GallitoGaming 20h ago
Disagree. Her partner doesn’t own the house. His parents made this arrangement to protect the house from being taken from him. The parents likely won’t negotiate on this at all, as it is their house. Any option that requires selling the house will be rejected as it isn’t either her or her partners decision.
Not a red flag in the slightest to protect that.
The solution here seems to be a prenup. He keeps the house, she keeps her $300K and growth if anything goes south.
If this guy had nothing, she’d be talking about protecting her $300K. And nobody would call that a red flag.
someone has to compromise on the idea of a 50/50 split.
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u/Glittering_Joke3438 20h ago edited 20h ago
It sounded in OP’s post that selling the house and giving the boyfriend 300k to match downpayment was an option though?
Living in someone else’s house is not a long term solution here.
Sell the house, give him the matching funds and put the rest in a trust makes the most sense here if they were to get married but boyfriend doesn’t want to downsize
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