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  • FIRST POST
    • chelseablue
    • By chelseablue 17th Oct 16, 11:52 AM
    • 1,850Posts
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    chelseablue
    Buying someone out?
    • #1
    • 17th Oct 16, 11:52 AM
    Buying someone out? 17th Oct 16 at 11:52 AM
    Not that it matters to anyone on here but this situation isn't actually happening to me I was having a discussion yesterday with my cousin


    If me and my partner were to split up, how do I work out how much he would be entitled to if I were to buy him out?


    We have a trust deed saying we own the house 70% me and 30% him


    He put in £6,000 deposit and since we bought it the value has risen approx. £28,000 (according to the Nationwide hpi calculator)
    Baby Boy born May 2014

    Mortgage starting balance 26.02.16 £231,294
Page 1
    • G_M
    • By G_M 17th Oct 16, 12:05 PM
    • 37,089 Posts
    • 41,048 Thanks
    G_M
    • #2
    • 17th Oct 16, 12:05 PM
    • #2
    • 17th Oct 16, 12:05 PM
    If me and my partner were to split up, how do I work out how much he would be entitled to if I were to buy him out?

    We have a trust deed saying we own the house 70% me and 30% him
    Originally posted by chelseablue
    1) You get the property valued ( say £200,000)

    2) You ask your mortgage lender how much is still due on the mortgage ie the redemption amount (say £100,000)

    3) you calculate the equity (£200K - 100K = £100K)

    4) You pay him his share of the equity (£30K)

    5) You pay off the existing mortgage (£100K) and take out a new one in your sole name for whatever amount is needed. (eg £130K to cover the old mortgage and your ex's share).
    • chelseablue
    • By chelseablue 17th Oct 16, 12:15 PM
    • 1,850 Posts
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    chelseablue
    • #3
    • 17th Oct 16, 12:15 PM
    • #3
    • 17th Oct 16, 12:15 PM
    1) You get the property valued ( say £200,000) £428,000

    2) You ask your mortgage lender how much is still due on the mortgage ie the redemption amount (say £100,000) £228,000

    3) you calculate the equity (£200K - 100K = £100K) £200,000

    4) You pay him his share of the equity (£30K) £60,000

    5) You pay off the existing mortgage (£100K) and take out a new one in your sole name for whatever amount is needed. (eg £130K to cover the old mortgage and your ex's share).
    Originally posted by G_M
    £60,000 seems a lot to have to give after less than a year of ownership and he only put £6,000 in, that's what I call a great return


    I thought I would have to pay his £6k he put in plus 30% of the rise in value since we bought it?
    Baby Boy born May 2014

    Mortgage starting balance 26.02.16 £231,294
    • Pixie5740
    • By Pixie5740 17th Oct 16, 12:22 PM
    • 8,873 Posts
    • 11,889 Thanks
    Pixie5740
    • #4
    • 17th Oct 16, 12:22 PM
    • #4
    • 17th Oct 16, 12:22 PM

    I thought I would have to pay his £6k he put in plus 30% of the rise in value since we bought it?
    Originally posted by chelseablue
    Why would you think that if your deed of trust says...


    We have a trust deed saying we own the house 70% me and 30% him

    Originally posted by chelseablue
    Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.
    • chelseablue
    • By chelseablue 17th Oct 16, 12:27 PM
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    chelseablue
    • #5
    • 17th Oct 16, 12:27 PM
    • #5
    • 17th Oct 16, 12:27 PM
    Why would you think that if your deed of trust says...
    Originally posted by Pixie5740
    Im not entirely sure haha, me and my cousin were having a discussion yesterday trying to work it out.


    60k just seems a lot after less than a year
    Baby Boy born May 2014

    Mortgage starting balance 26.02.16 £231,294
    • G_M
    • By G_M 17th Oct 16, 12:27 PM
    • 37,089 Posts
    • 41,048 Thanks
    G_M
    • #6
    • 17th Oct 16, 12:27 PM
    • #6
    • 17th Oct 16, 12:27 PM
    Why would you think that if your deed of trust says...
    Originally posted by Pixie5740
    Indeed. If the intention had been for the respective deposit amounts to be taken into account, the Deed would say so.

    The Deed refers to percentage ownership of the property, not % increase in value.
    Last edited by G_M; 17-10-2016 at 12:30 PM.
    • chelseablue
    • By chelseablue 17th Oct 16, 12:30 PM
    • 1,850 Posts
    • 2,357 Thanks
    chelseablue
    • #7
    • 17th Oct 16, 12:30 PM
    • #7
    • 17th Oct 16, 12:30 PM
    I put in £164,000


    Mortgage payment is 50/50
    Baby Boy born May 2014

    Mortgage starting balance 26.02.16 £231,294
    • G_M
    • By G_M 17th Oct 16, 12:32 PM
    • 37,089 Posts
    • 41,048 Thanks
    G_M
    • #8
    • 17th Oct 16, 12:32 PM
    • #8
    • 17th Oct 16, 12:32 PM
    I put in £164,000


    Mortgage payment is 50/50
    Originally posted by chelseablue
    Both irrelevant if the Deed says:

    we own the house 70% me and 30% him
    but it might be worth quoting the exact wording to be sure.
    • Pixie5740
    • By Pixie5740 17th Oct 16, 12:34 PM
    • 8,873 Posts
    • 11,889 Thanks
    Pixie5740
    • #9
    • 17th Oct 16, 12:34 PM
    • #9
    • 17th Oct 16, 12:34 PM
    What is the exact wording of the Deed of Trust?
    Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.
    • chelseablue
    • By chelseablue 17th Oct 16, 12:35 PM
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    chelseablue
    This is what it says:
      1. The net sale proceeds shall be paid as to:

        1. The fixed sum of £164,000.00 to the First Owner
        2. The fixed sum of £6,000.00 to the Second Owner.
        3. The balance being divided between the Co-Owners by paying the First Owners share to the First Owner and the Second Owners Share to the Second Owner.

    Baby Boy born May 2014

    Mortgage starting balance 26.02.16 £231,294
    • G_M
    • By G_M 17th Oct 16, 12:37 PM
    • 37,089 Posts
    • 41,048 Thanks
    G_M
    Well that is entirely different to what you initially told us!

    Sigh!

    and it's not even the entire quote. You want help? Quote the whole thing- preferably in your first post!

    (bye bye)
    • chelseablue
    • By chelseablue 17th Oct 16, 12:38 PM
    • 1,850 Posts
    • 2,357 Thanks
    chelseablue
    Whoops, apologies!
    How is it different? Glad I asked on here now I must say
    Baby Boy born May 2014

    Mortgage starting balance 26.02.16 £231,294
    • G_M
    • By G_M 17th Oct 16, 12:40 PM
    • 37,089 Posts
    • 41,048 Thanks
    G_M
    We have a trust deed saying we own the house 70% me and 30% him
    is not the same as
    1. The net sale proceeds shall be paid as to:

        1. The fixed sum of £164,000.00 to the First Owner
        2. The fixed sum of £6,000.00 to the Second Owner.
        3. The balance being divided between the Co-Owners by paying the First Owners share to the First Owner and the Second Owners Share to the Second Owner.
    Now is it?
    • chelseablue
    • By chelseablue 17th Oct 16, 12:43 PM
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    chelseablue
    Correct, I just looked at the first page where it says The First Owners Share 70% and Second Owners 30%


    Now that I've posted the correct info, on todays value, how much would he be entitled to?


    Im crap at this sort of thing, as you can probably tell
    Baby Boy born May 2014

    Mortgage starting balance 26.02.16 £231,294
    • Pixie5740
    • By Pixie5740 17th Oct 16, 12:48 PM
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    Pixie5740
    Points 1 and 2 of your Deed of Trust are clear but point 3 is woolly. How is the balance to be divided between the co-owners?

    If we assume that the balance is to be divided equally between the two of you then after you get your £164k and he gets his £6k back then there is £30k left to split between you. So he'd get £15k and you'd get £15k.
    Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.
    • G_M
    • By G_M 17th Oct 16, 12:48 PM
    • 37,089 Posts
    • 41,048 Thanks
    G_M
    Have you got a calculator?

    There's probobly one on your phone or laptop.
    • G_M
    • By G_M 17th Oct 16, 12:49 PM
    • 37,089 Posts
    • 41,048 Thanks
    G_M
    Points 1 and 2 of your Deed of Trust are clear but point 3 is woolly. How is the balance to be divided between the co-owners?
    Originally posted by Pixie5740
    It's not woolly Pixie - it's incompletely quoted. Again.
    • chelseablue
    • By chelseablue 17th Oct 16, 12:51 PM
    • 1,850 Posts
    • 2,357 Thanks
    chelseablue
    It's not woolly Pixie - it's incompletely quoted. Again.
    Originally posted by G_M
    There isn't anything further after point 3
    Baby Boy born May 2014

    Mortgage starting balance 26.02.16 £231,294
    • Pixie5740
    • By Pixie5740 17th Oct 16, 12:51 PM
    • 8,873 Posts
    • 11,889 Thanks
    Pixie5740
    It's not woolly Pixie - it's incompletely quoted. Again.
    Originally posted by G_M
    Until the OP clarified what it actually said I was starting to think the Deed of Trust had been drawn up on the back of a fag packet.
    Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.
    • chelseablue
    • By chelseablue 17th Oct 16, 12:52 PM
    • 1,850 Posts
    • 2,357 Thanks
    chelseablue
    no was done by the solicitor at the time
    Baby Boy born May 2014

    Mortgage starting balance 26.02.16 £231,294
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