Implications of improperly identified financial contributions to marriages by third parties.
I have had cases recently involving parental financial contributions to their offspring’s matrimonial home, often substantial, largely as a result of ever-increasing property prices and parents who have benefited substantially from them.
Often parents are contemplating providing a lump sum to their children as a substantial deposit towards the purchase of their matrimonial home or where they are buying a property as a cohabiting couple.
Think about what you are offering and the terms
When it comes to separation, ultimately inevitable disclosure procedures will need to be undertaken, to address financial negotiations between separated couples. That is when your parental financial contribution will raise its head.
During practice, I have often encountered evidence of a significant cash contribution from parents to help their children with a good start in life, some financial cushion with which to build their marriage together which obviously will last a whole lifetime. Until it doesn’t.
Suddenly, parents who have given money without any formal record of a loan or whether it is to be repaid will find themselves facing the daunting possible prospect of losing a hefty proportion of that money to the global matrimonial/cohabitee assets, in order to satisfy the relevant law.
Marriage or cohabiting attracts different legal considerations but is equally important and relevant to this dynamic.
What you should do before committing
It is fundamentally important that you seek and act on legal advice from the outset even if the thought has only just arisen. IMMEDIATELY. Here we will advise you of the consequences and the best way to afford you protection if the unforeseeable happens. There is protection available concerning legal charges/declarations of trust. Mechanisms to secure your contribution.
Our legal family or property departments can advise you how to protect your contributions in a manner that will provide you with peace of mind and your adult children with every opportunity to financially build as they grow, with the appropriate legal safety net in place.
Don’t delay this if it applies to you. We have a free initial consultation service available for you so that you can discuss this with us with a view to making an informed decision.
To explore your options further and receive personalised legal guidance, don’t hesitate to get in touch with our family team. You can reach us at 01202 203200 or via email at enquiries@hgw.evmk.dev. Alternatively, you can fill out our contact form for a Free 30-minute Consultation here.