Beneficial Interest

Griswold

Just a quick question.
We have had notice from OR that I can buy my OH benefical interest in our house. He is bankcrupt, Im not. Now I don't really get it. We are in negative equaty and have had an estate agent out to value the house plus the amounts owing from our mortgage and secured loan.
I know I have to pay OR £288 plus £1 if in negative but do I need my own solicitor too?
Do I have to have mortgage just in my name as I don't earn enough to get a new mortgage?
Am I just buying all future profit in the property or just for now?

I just don't understand what I would be buying only that it would secure my house from any future interest from the OR.

Can anyone shed any light for me.

Thanks

peachyprice

Hi Griswold,

You do not need your own solicitor, the fee of £288 is to cover all legal expenses.

You are not changing anything to do with the mortgage, or who owns the house, this remains as it is in both your names and you continue to pay as normal.

Your are buying any rights the OR may have equity in the future, nothing else. You can sell this back to your OH at a later date if you so wish.

Griswold

Thanks for the reply, we have to send everything off to the OR this week so I wanted to know
The value of the house is alot lower that we ever thought.

smilernpb

I have to deal with this too.

From what I can gather it's like this. Basically you are buying the potential interest (in the future) in the house, seeing as there isn't any at the moment. If it was to suddenly shoot up by say £10,000 and that was say £5,000 over the value of the house, the £5,000 equity would, by rights, be yours. I think??

peachyprice

The whole £10k would be yours, you would already have your own £5k, plus the other £5k you have bought the rights to from the OR

smilernpb

peachyprice wrote: »

The whole £10k would be yours, you would already have your own £5k, plus the other £5k you have bought the rights to from the OR

Really?

So you are buying essentially the difference between what it is worth, and what is sells for, regardless of how much the BR person owes on the mortgage? Gosh, that's complicated.

peachyprice

Yes, that's right. If there's equity at the time of BR the non BR partner only has to buy half of it as they already have a right to the other half. If there is no equity the non BR partner is buying the future rights to the other half of any equity as they already have rights to the their half. The Non BR person ends up with 100% of current or future equity.

smilernpb

peachyprice wrote: »

Yes, that's right. If there's equity at the time of BR the non BR partner only has to buy half of it as they already have a right to the other half. If there is no equity the non BR partner is buying the future rights to the other half of any equity as they already have rights to the their half. The Non BR person ends up with 100% of current or future equity.

So: if two BR people share a house (me and hubby) do we have to buy one lot, or two lots of the equity? i.e one or two payments of £288 plus £1 for negative equity.

tigerfeet2006

You buy 2 lots. The fees stay the same, I thought it was £211 didn't realise it had gone up So one lot of those. Then you each pay a one pound nominal price for the negative equity.

Does that make sense. I'm knackered, tell me to go to bed someone

smilernpb

tigerfeet2006 wrote: »

You buy 2 lots. The fees stay the same, I thought it was £211 didn't realise it had gone up So one lot of those. Then you each pay a one pound nominal price for the negative equity.

Does that make sense. I'm knackered, tell me to go to bed someone

I need to pay one lot of £288 and £1 for mine, then £288 and £1 for hubbys? Not two lots of £288 (or whatever)?

Go to bed! I'm tired too, following you round the posts for the past hour or so x

peachyprice

Two lots of £1 definitley, but I can't remember if it's 2 lots of £288 costs (I thought is was £211 too, it must have gone up). But yes, you both have to buy it. But if you get somone else to buy it for you i.e family member, they buy the whole lot for £1 + £288.