How can my brothers split the proceeds of a house sale fairly?

Q Three of my brothers owned a house together, which they recently sold. Two of the brothers put £75,000 each into the house and the third brother, who has not lived in the property for 10 years contributed £3,000 towards the purchase of the house. There was no mortgage on the property.

They had no deed of trust. We would like to know what is the legal way of splitting the profit from the house. The house sold for £490,000.

A Given the unequal contributions that your three brothers made to the purchase price of their house, it was severely remiss of the solicitor who did the conveyancing not to discuss drawing up a deed of trust. A deed of trust is a legal document which spells out who owns what percentage share of the equity and can also be used to spell out what should happen if one joint owner wants to sell up.

In the absence of a deed of trust, when a property is sold the law assumes an equal split of the sale proceeds between joint owners. But making that assumption wouldn’t be very fair on your two brothers who each put in £75,000. They can’t draw up a deed of trust retrospectively but they can – with your other brother’s agreement – split the £490,000 they got for the house according to the percentage share they initially contributed.

So assuming that the house originally cost £153,000 (two times £75,000 plus £3,000), the brothers who contributed £75,000 should each get 49% of the sale proceeds leaving your other brother with a 2% share. These percentage shares would also apply to the amounts used to calculate any capital gains tax bill which may be due to the brothers who didn’t live in the house.

READ  Someone hit the $530 million Mega Millions jackpot. Here's how winners can protect their privacy

Muddled about mortgages? Concerned about conveyancing? Email your homebuying and borrowing worries to Virginia Wallis at



Please enter your comment!
Please enter your name here