Your girlfriend's situation is very close to mine. My wife and I bought our first house together 3 years before we got married, BUT we lived together for several years before buying the house. My family trust also helped out with the down payment and while that is a good thing, it is very complicated and I don't think my wife fully understood the implications of that. "not worrying about the terms" is not necessarily a bad thing, just be careful what she means by that and DEFINITELY get the details, don't just let her family handle the terms. I didn't worry about the terms either, We set it up as a loan as well for tax reasons and to protect the trust's interest (the rest of my family), if it was a gift from the trust it would be treated as income and taxed as such and it would also be non-redeemable if something bad happened to our relationship- so that might be the reason behind the loan for her, but it was not a loan to produce income for the trust. We view the trust as our inheritance, might as well benefit from our inheritance when I was young and broke rather than wait until I am 70 when my parents die and by then I will be financially independent anyway and won't need any extra money. The terms of my loan were: 0% interest only loan with a balloon payment of the initial principal upon circumstances where neither of us are materially invested in the property, I.E. split up, divorce, my death, or sale of the property. Remember this was before we got married, so if I died, my wife had 6 months to repay the trust so I took out a term life insurance policy that would cover the repayment if that happened, it was cheap insurance for a healthy 28 year old and I cancelled it as soon as I had enough assets to cover the loan if I died, it probably cost less than 500 bucks for the duration of the insurance. That way my wife would not be forced to sell the property if I died, I guess she could have refinanced, but then as a single young widow, she would have to make the mortgage payments, AH! things most people dont have to think about when they are in their twenties . I am sure the trust lawyer can handle the legaleze to protect both Her and your own interests- family trusts are complicated and involve lots of people, not just the two of you, so in essence you would be buying the house with her whole family, are you ready for that? Then again if you are already thinking about marrying someone with the type of family that is close enough and wealthy enough to have a family trust managed by a close family member, then my guess is you have a slight understanding of what you are signing up for, not necessarily a bad thing, but a complicated one. I hope you love her family as much as you love her!
As an aside, My wife and I are very mustachian and even though my family is wealthy, they raised me with mustachian values so that is not necessarily a bad thing. Entitlement to wealth that you did not earn yourself more often than not turns out badly most of the time, but not always. The reason my family is very wealthy is BECAUSE we are all mustachian and have been for generations. So even through the help of the trust, we bought the cheapest house we could find, 700 sq. foot dump on the edge of town even though we could have bought a house 3 or 4 times as expensive, we sure as hell didn't need to! We were in our tweinties! What the hell did we need a nice house for! Since then we have bought two other houses and rent out our first and second house which we now own free and clear after paying back the trust and accelerated mortgage payments to the bank for 9 years. If we had bought a bigger house up front, we would probably still own one house. We would not have the extra equity in the three houses and we would not have the rental income- buying that first house was the first step toward financial independence and quiting our jobs. I guess you can say it was a test of my wife's ability to adapt to my mustachian philosophies and live very, very well below our means, besides it was so much fun living in that tiny house and remodeling it with my wife in the evenings after work. By the way she passed that test- she passes all the mustachian tests that life throws at her, one major reason I love her and married her. On the other hand, my earlier girlfriend that I thought I was gonna marry someday, it would have been a disaster, she is out there somewhere, I bet she is broke, making shitloads of money, living paycheck to paycheck, married to some guy who works 80 hour weeks and I bet she complains about it.....
Cheers,
Scott