Buying someone out of a property

Betster

Hello,

I was wondering if someone could help me with some advice please? My boyfriend currently lives with his house mate in a property which they own 50/50. We are thinking of moving in together and weighing up all our options. One possibility (perhaps) is me buying out his housemate. However, where do you even begin with something like this? Also how much would it cost me i.e. would I have to pay half the equity in the house if it was sold in theory?

Thanks very much

pipo

I would be inclined to find out whether his mate would consider being bought out first, just in case he's planning on staying there for long (or indeed buying your boyfriend out).

If the answer is "Yes" the property would then need to be valued by an EA / surveyor and again you need to ask the question if the mate is happy to be bought out at that price.

If all parties are happy the details of the 'buyout' can then be sorted out through a decent solicitor.

Betster

That's great thank you. It's all purely theoretical at the moment but just trying to obtain all the facts possible!

What I'm not sure about though is the price you pay to buy someone out - if it's a 50/50 mortgage and say for example, there is £15,000 profit when the house is valued - would I pay £7500 to buy him out? As far as I know he paid no deposit.

pipo

Ah, then you need to calculate his total equity on the house.

For example if you take a house bought for £100k and your BF paid a deposit of 20% and matey-pants zilch, but shared the remaining 80% mortgage 50/50, then the split is 60/40 to your BF (as 80% /2 = 40% each + 20% from the deposit for your bloke).

If same house is now valued at, say £150k, then you would need to pay matey-pants £60k for his share of the property.

Apologies if the maths seemed a bit patronising. I was always told to show my workings to maximise marks

Oh and a gentle nudge in the direction of the "Thanks" button. Cheers!

david29dpo

As above but your B/Fs mate will also need to convince the lender to be taken off the mortgage. Your B/F will also need to convince the lender he can afford the loan. Will you be added to the mortgage?

Betster

That's really helpful thank you - I was completely clueless!

I think I've hit the thanks button for you - to be honest my post yesterday was the first time I'd been in a forum....ever! So all the etiquette and how the forum all works is a bit new to me!

Thanks once again