QLD How to legally plan ahead to protect family home?

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2 April 2021
Hi everybody,

Could I please discuss a scenario. Apologies if too much detail is presented, I'd just rather go with too much than not enough :)

A couple are in the market to buy their first family home. This will never become an investment property. They have been together for more than 10 years, always renting. They have no children and won't have any. One spouse is a business owner, who will put down the deposit for the house and pay all the loan installments, maintenance expenses etc. The other spouse has always been and will be a home maker with no income.

The business owner has adequate insurance cover relevant to the business e.g. assets, revenue, liabilities etc. In order to further shield their family home, they are trying to choose one of the following cost-effective methods: (A trust is not an ideal option for them as it brings the capital gains tax consequences if they ever decide to sell the house)
  1. putting the title in the non-working spouse's name only while both spouses are on the loan; Or,
  2. buying the property as "tenants in common" with %95 of shares in the non-working spouse's name, and %5 in business owner spouse's name. (both spouses are on the loan in this case too)
If we they go down the "tenants in common" pathway, will ONLY %5 of their property be exposed to potential claims in case the business owner becomes bankrupt? Or will the fact that the bankrupt spouse is on the title somehow opens a legal avenue for the creditors to be able to go after more than %5 of the property? (via constructive trust and/or results trust remedies or any other avenues)

Thank you.
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