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    • Grantyy
    • By Grantyy 12th Oct 17, 6:53 PM
    • 33Posts
    • 3Thanks
    How to be fair to GF if we pay the mortgage off
    • #1
    • 12th Oct 17, 6:53 PM
    How to be fair to GF if we pay the mortgage off 12th Oct 17 at 6:53 PM
    Hi, I hope to ask for impartial advice on our current situation, we are stuck with agreeing what is fair in the situation below.

    I bought my House when I was 19 for £24.500, I am now 37 and It is worth 80-85k, to be fair the price shot up not long after I bought it as they all did back around 99-2000.
    I took two loans alongside my mortgage totalling 12.000 for repairs and improvements. The main is now at 16.800 with the other about 8k with about 5 years left to pay it off.

    My girlfriend has had some money from a relative come through and we have enough to pay the remainder off but she says if we do that she wants the same amount back if anything goes wrong with Us, we have lived together for 3 years since the birth of our first child and now have 2 young children, my only aim is that we will leave them enough for a house each.

    We both want to be fair to each other here but my sticking point is that if she takes 25k back out then I have to borrow the same amount and will be back to square one when I was 19. Also a large part of that money went back into the house for maintenance (double glazing, damp course, shower, boiler and part central heating, new kitchen are the main ones) which we will ultimately sell to free our money in any bad event.

    When I took the mortgage they advised 25 years I knocked it down to 22, then a few times I overpaid and reduced the term so I am reluctant to risk going back to square one.

    We are aware of common law and all of that, we have kids and live together so If she wanted I'm sure she could take half but we want to be fair, she has her dads place coming down the line and ultimately if the worst did happen we would both have enough for a house with a split at that point.

    Am I being unreasonable? If we are mortgage free we stand to save £400 a month between us and a lot of what I had done previous has led to us being in that position but as she is the one with the money to repay I think she sees it the other way around.

    There has of course been thousands in interest paid which is hard to take into account as its dead money.
    I often think just do it, we won't split but she did nearly leave me out of the blue about 4 years back before we had kids and I guess that's something that is playing its part with the trust. I do trust her intentions and that she as me wants the best for the kids in the long run.
    I have asked her if we get all of the figures and saw a financial advisor maybe they'd be able to give a fair figure but she is adamant she wants the full amount paid in back.
    All advice is appreciated even if that is that I am in the wrong here. I just want it to be fair based on what we both put in and ultimately what we take out, If she didn't have more coming to her I'd be much more open to a 50/50 split for the kids sake.

    Thank you
Page 1
    • zx81
    • By zx81 12th Oct 17, 6:58 PM
    • 13,678 Posts
    • 14,141 Thanks
    • #2
    • 12th Oct 17, 6:58 PM
    • #2
    • 12th Oct 17, 6:58 PM
    I think if she only wants the same back as she puts in, that's a little unfair on her, as it will mean she won't benefit from any increase in value.

    I'd suggest that she gets the same % out as she puts in.
    • Keep pedalling
    • By Keep pedalling 12th Oct 17, 7:48 PM
    • 3,752 Posts
    • 4,019 Thanks
    Keep pedalling
    • #3
    • 12th Oct 17, 7:48 PM
    • #3
    • 12th Oct 17, 7:48 PM
    If she is putting that much in she should have part ownership, as a tennant in common. if not she would get nothing if you die, unless you have a will in place which, stupidly most cohabiting couples fail to do.
    • getmore4less
    • By getmore4less 13th Oct 17, 7:35 AM
    • 30,000 Posts
    • 17,929 Thanks
    • #4
    • 13th Oct 17, 7:35 AM
    • #4
    • 13th Oct 17, 7:35 AM
    Has she been paying towards the debts already?

    If you want to be fair you need to account a share for that as well as any new money going in.
    • Pixie5740
    • By Pixie5740 13th Oct 17, 9:27 AM
    • 11,010 Posts
    • 15,187 Thanks
    • #5
    • 13th Oct 17, 9:27 AM
    • #5
    • 13th Oct 17, 9:27 AM
    What are you aware about in relation to common law? That common law spouses don’t exist in the uk?

    The fairest way to do it would be for her to get an equity share of the property in return for the £25k she will put in. I work that out to be around a 30% share for her leaving you with 70% so you could own the property as TIC with a 30/70 split.

    Why is the interest you have paid difficult to take into account. Surely any capital appreciation has outstripped the amount of interest you have paid.

    You say that if your girlfriend gets her money back that you’ll be back at square one but you won’t be you’ll have £55k+ in equity. What is your proposal? That your girlfriend pay £25k and in the event of a split ends up worse off than you were back in 1999?
    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.
    • getmore4less
    • By getmore4less 13th Oct 17, 2:49 PM
    • 30,000 Posts
    • 17,929 Thanks
    • #6
    • 13th Oct 17, 2:49 PM
    • #6
    • 13th Oct 17, 2:49 PM
    Interest is not relevant that is just servicing debt used to buy equity.

    You need to understand how equity works.
    • tlc678910
    • By tlc678910 14th Oct 17, 6:43 PM
    • 478 Posts
    • 864 Thanks
    • #7
    • 14th Oct 17, 6:43 PM
    • #7
    • 14th Oct 17, 6:43 PM
    If you don't want your girlfriend to have a share of your property suggest that she invests her money elsewhere while you continue paying the loans (this will cost you more with interest of course).

    If you will allow her to have a fair % of the house based on what she pays in and the current value you could then save what you were paying to the loans increasing your security whatever the future brings.

    • Tom99
    • By Tom99 14th Oct 17, 7:46 PM
    • 268 Posts
    • 128 Thanks
    • #8
    • 14th Oct 17, 7:46 PM
    • #8
    • 14th Oct 17, 7:46 PM
    Yes I agree with the above 25K buys 25/80ths of the house so if it is sold in the future she will get 25/80ths of whatever it sells for or you will give her that amount to buy her out.

    She may get more or less than £25k depending if the house goes up or down in value.

    You can't expect her to put money into your house and get nothing back.
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