Advice needed from a mortgage/financial advisor!!

callyh26

Basically this is the story my partner and his ex bought a house together in 2005. They split up in 2009, but they still own this house together. She hasnt lived in it since 2010 and hasnt contributed towards the mortgage or the loan that is secured on it. My partner is my opinion is rather foolishly doin this all himself. The mortgage has £69,000 remaining with 28 years term and the loan £15,000 with around 7 years term. The house needs work i.e re-roofing, just to make it livable but he's being very stubborn and doesnt want to sell as he believe's he wouldnt then get back on the property ladder. The mortgage was a 100% mortgage. He earns a good wage (around £1700 pcm after tax) has been in his job around 8 years, but doesnt have a great credit rating. The mortgage and Loan show as good on his credit file as these have always been paid on time. But he does have a few debts not many i think they add up to no more than £4000, but since spliting with her he put his head in sand and didnt pay so theses have defaulted. With the roof leaking and the work that needs doing my partner is quite happy to plow our money into the repairs with no legal advice etc and i think he's being very foolish! She hasnt contributed for at least 2 years now he has paid it, she doesnt want to contribute towards any work/repairs and i think would be quite happy to sell. I dont think theres equity i the property basically it would need to sell to cover the mortgage and loan thus allowing a clean break! But my partner abslutly refuses to see sense! He wants to keep the house as investment but in my opinion he could continue plowing money into it and she could just wait for him to make it look all nice and then make him sell!! How would he stand having her name taken off? He has as i said been paying it although rather foolishly been giving her the cash for the direct debit to come from her account but the secured loan has always come from his? Would it be a case of speaking to the mortgage company and getting a new mortgage in his name? Or simply asking for paper work to take her off? I know they'd do check etc to make sure he can afford! All i want is him not to be ripped off! especially when its our money he's using to do this house up! I dont want him to do it and then she make him sell anyway! Help/advice needed :-/

The_J

She would be entitled to 50% of any equity built up in the property. So anything you put in, you are giving her 50%.

I take it that the mortgage is with Northern Rock. He needs to ask them to transfer the mortgage into his own name. Will the defaults this might not be possible although on salary it seems fine. The ex would have to be happy to sign this away. Given there is no equity in the property currently she should just be happy to disappear.

tommo121_2

I know a few people that have been in similar position. You must get you partner to stop and take advice. Yes, the ex may have a claim without taking action to restrict interest from the ex. Suggest have a look at these guys, they have won a few awards for advice and they do free financial planning on divorce consultation.

needanadviser.com/html/article.php/zcid/1316/type/article/finance/Free_Financial_Advice

holly_hobby

The lender will only allow the ex to be released (and with her agreement or via the courts), if your partners (and your own, if you go onto the mge), income is sufficient to service the mge and subject to status.

If they refuse to release her due the status of the existing/proposed mortgagor(s), which they may, then I am afraid this cannot be challenged with them.

The only solution would be for her to agree to a legal contract, in which she agrees to forfeit her share of equity in the property - which lets face it is highly unlikely.

Or, the other option is to sell - if she refuses to agree to the sale, and can't have the mge transferred into her own name (for the issues noted above), your ex would need to go to court to obtain a forced sale agreement.

Also don't forget, that as currently party to the mge, this will also affect her own borrowing capacity for mge borowing, whilst her also remaining jointly and severally liable (with your ex) for all payments and maintenance of the mortgage i.e the lender could pursue her for non payment or a shortfall to mge debt on sale, for a period of 12 yrs ..... perhaps if she was reminded or made aware of this aspect (and if the lender is agreeable to the discharge of her) .. she may ask to be taken of the deeds pretty sharpish - problem solved !

First thing to do is speak to the lender, your ex to present his proposal re the transfer, and see after status checks if they would be prepared to facilitate this - then you know what angle you could play with her !

Any transfer of equity such as this will involve legal fees, and she may also require a sum to effectively "buy her out" - which may also put the mockers on things ... it will be a case of suck it and see ..

I wish you well and hope this helps

Holly x

PS - tsf of equity (with her agreement) could also take place as part of a remortgage to a new lender (free legals wont' apply) - but with the status issues of your ex, this may not be possible at this time - half hour with a broker would be an idea if this is considered attractive.

(rule of thumb is the older the default the more chance of placement, with defaults effectively "falling" off the individuals CR following their 6th anniversary of registration).

callyh26

The mortgage is with Future mortgages. There is like i say 69000 on the mortgage and a 15000 secured loan in the state the house is in i think they'd get 80000 at a push so there is very little equity as it stands! which is why i know she will let him put our money into fixing and doing it up then make him sell thus gaining herself a profit!! So if we drew a letter up to send to the mortgage company basically saying he wanted to take over the mortgage by himself provide wage slips etc they will then let us know if they would be willing to transfer it just to my partner?

callyh26

If the mortgage company refused say on his credit rating if he got a solicitor to draw a letter up basically saying she wants nothing to do with the house and from that date on forfeits any share or profits in it now or if it was ever sold and she signed is there anyway she could go back on that?

callyh26

Does anyone know of a letter Template or can advise me of what he should put in writing to the mortgage company?

holly_hobby

Just ring them for guidance on how they require the request to be submitted - a phone call my suffice to get the ball rolling & status checks made - don't forget he will also need the ex to agree to her removal, to have the tsf of equity effected.

Hope this helps

Holly

callyh26

Sorry to be naive but what's TSF of equity mean? Lol

holly_hobby

Sorrry .... = Transfer of equity

Which is simply that his ex is transferring her share of the property and liability to him (in having her name removed and the deeds amended).

Holly

dimbo61

Hi Callyh26,
The brand new post by tommo121 ( his/her very first post!!!) has a link to WHO ?
Be very careful please and speak to the lender first and then CAB or one of the 2 registered charities which deal in debts for FREE
Many many sharks out there who will charge you a fortune for poor advice and HUGE FEES
You have been warned Please be careful