What is Deed of Trust?

Full Definition

A deed of trust (also called a declaration of trust) is a legally binding document that sets out the beneficial ownership of a property where more than one person has a financial interest. It records each party's share of the equity, how sale proceeds are split, who pays the mortgage and other costs, and what happens if one party wants to sell. It is commonly used by unmarried couples, friends buying together, or where a parent contributes to a deposit. In England and Wales, owners can hold property as joint tenants (equal, automatic survivorship) or tenants in common (defined shares), and a deed of trust typically supports the latter. It matters because, without it, disputes over who is entitled to what can be costly and uncertain, especially for cohabitants who have no automatic property rights. A deed of trust does not change the legal title at the Land Registry but governs the underlying financial split. Seek conveyancing or legal advice when drafting one.

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