Charge on house after split

Paddy29_2

Hi, I need some advice if you would be so kind.

I bought a house with my ex-partner 18 months ago but we split 8 months afterwards. My ex moved out of the property but at that point we hadn't paid enough of the loan off for our lender to allow me to take the mortgage on myself. However, they advised after 6 months this would be allowable.

I agreed at the time with my ex (verbally only) that she could stop paying her half of the mortgage on the basis that I get a lodger in and she would sign over her proportion of the house (about £5ks worth) for no fee once the mortgage could be signed over.

We are now 6 months down the line and she has changed her mind and is wanting to put a charge on the house for the £5k. My argument is that had the house been put on the market at the time of the split she would have ended up losing money because the value had gone down and she would have had to carry on paying the mortgage whilst we tried to sell it.

We have a declaration of trust in place so that the first £23k of the house gets split £18k for me and £5k for her and the rest is split 50/50 (after various fees).

Does she continue to have rights to 50/50 of the house now that she is not paying any of the mortgage? Could I force here to pay me back for the last 6 months of mortgage payments and then sell the house? If I put a charge on the house would she be entitled to a proportion of the value for me spending money improving the value of the house? What if my lender refused to accept the charge? If I rented out the property in the future would she be entitled to any of the income?

Any advice would be greatly appreciated

RAS

You need a good lawyer if you want to over-turn the deed of trust.

Paddy29_2

I don't want to over-turn it. Just don't know whether it would be worth trying to put the charge in place or chasing her for the money she hasn't paid for the last 6 months and selling the house - she wouldn't get her £5k then anyway because the value has reduced.

auroan

If she wants the charge, she stumps up her 6 months of mortgage contributions. She can't have it both ways.

Paddy29_2

If only it were that simple mate!

BobQ

Unless you have any legal agreement to the contrary you have to adhere to the Deed of Trust. You are jointly responsible for paying the mortgage. See a solicitor.

Thrugelmir

Sell the property and divide the equity in the proportions of the initial deposit. If you are not in a position to buy your ex out.

While she hasn't paid the mortgage, she has incurred the costs of living elsewhere.

zzzLazyDaisy

The trust deed stipulates how the net equity will be divided in the event of a sale. That continues in force regardless of the fact that she has moved out and is no longer contributing to the mortgage.

Your liability for the mortgage is joint and several. This means that you are both equally liable for the whole amount and in the event of a default, the lender can pursue either or both of you. Of course the easiest person to pursue is the person living in the house.

To be honest, in this situation, the best thing to do, normally, is either to buy the other person out, or sell the house. Sometimes it is worth taking the hit. Otherwise this will hang round your neck like a millstone.

I suggest that when you are ready to have the house put into your sole name, you discuss all your options with the solicitor who will be dealing with the transfer for you.

EDIT: Just to say, in simple terms, she continues to be part owner of the house, regardless of whether she is living there, or contributing to its upkeep, and she is entitled to her share of any increase in value regardless how long this goes on for (although there has been a recent case which casts doubt on this in certain circumstances, but with the sums involved you are not going to want to get into expensive court proceedings on this point)

G_M

So just to be clear:

For the last 6 months you've been paying the mortgage alone?
And you've also had the use of the property?
And you've been receiving income from the lodger?
Your ex has not had use of the property?
So presumably has had to pay out rent elsewhere or rely on the goodwill of friends/family for a home?
But has not made morgage contributions?

Seems you're (about) quits!

So either sell and split as per the original agreement, or buy out your ex.

bris

She may pay the six months missing mortgage payments, but then she could charge you half a fair rent for the property, swings and roundabouts.
If she is going to be difficult and go back on her agreement you should just cut the ties and sell up, break the ties for good, this will be a problem for a long time to come.
The chances are the mortgage lender will not allow you to put the house into your name only, if she gets the charging order, this would scupper that.

Paddy29_2

Thanks for the replies guys. I was on the verge of transferring into my name. I had got the mortgage re-done in my name and sent off the transfer of equity forms from my solicitor. However, knowing how difficult my lender has been so far, I think putting a charge in would scupper all that and I would be back to square one.

The problem with selling would be that we would both end up with virtually nothing. Another option is for me to make a 'without prejudice' offer so as to avoid all the expensive legal fees