Need some legal advice re: selling a shared house.

AdamPD

Hello there

I have a question with regards to selling my home, which I coown/share with my father and uncle
The house is owned as Tenants in common and all three of us are on the deeds and mortgage
There is no trust deed setup for who owns which share
When purchasing the house, my father put down a £40,000 deposit
The uncle stopped paying towards the mortgage back in October 2010, then moved out in May 2011, leaving us with £5000 of arrears, which we've been paying off.

My question is this
If we sell the house, how is the equity divided?
My dad wants back his £40,000, plus "half" the equity
Basically he doesn't want his brother (the uncle) getting any of the equity and he's willing to use a "dodgy" solicitor to get what he claims is his rightful share of the propertys equity.

I did check with a solicitor via rightsolicitor.co.uk and his reply was:

If you have no trust deed and you are all named as joint owners of the property then the equity will be divided equally between the three of you. Your father is not automatically entitled to the money he put in as a deposit.

which I Did tell my dad, but he said he'd go the legal route and take the whole matter to court

I said IF we could get the uncle to forfeit his share, due to the arrears, then we could split the equity in half (roughly £30-35k each), he said no
Second attempt was you get your £40k, I get the rest (probably 30-35k), he said:

So if we went with option 1. You are saying the £40,000 I put in seven years ago makes no interest. But the nothing you put in makes £25,000 to £30,000 Some how that does not sound right to me.

So I said, you get "your" 40k back, plus £7000 and I get £30,000
Again, he said no

If I don't agree with his demand of half equity + 40k, he'll take it to court, he then very subtely threatened me by saying I have a friend solicitor and I wouldn't pay anything for his services, where as you'd pay 5k of more to fight me.

Could he fight it in court?

You might be asking why I don't agree with him getting his 40k plus equity, the reason is simple, he's selfish, a thief and has been telling his friends that my mother died of cancer years ago and is an awful person.

So I just want to go my seperate ways and not speak to him again, but I also want what's mine by law.

Any advice is appreciated

DVardysShadow

You have 2 very difficult problems. Your father is being pig headed, your uncle is being irresponsible. As I see this, you will need to sort out your father first before tackling your uncle.

In respect of fair shares, can you tell us

• how much the house was bought for
• who put in what deposit
• how much mortgage was taken out
• what the agreements were for payment of mortgage
• how much the house would sell for now

That will indicate what the fair shares will be - and then we can have a go at working out how to deal with your father and uncle.

BitterAndTwisted

Yes, he could fight it in court but it would not be cheap.

All three of you have acted like irresponsible fools by not getting a Deed of Trust drawn up at the very beginning.


Look at it this way: your father put in £40k which on the face of it could be viewed as having purchased X percent of the property's value, so it would be entirely fair now that the total value has increased that the value of his percentage has also increased.

You put in nothing and are expecting to gain 25 to 30 grand?

Why would a child seek to disadvantage their own father so ruthlessly?

AdamPD

Indeed, it is a horrible situation, sadly, my father and his two brothers are identical in terms of selfishness, I'm wondering if it's genetic, heh

I was quite happy to let him get his deposit back and half the equity, until I found out about him telling people my mother was dead.

That, combined with me finding him stealing food from my freezer on three occasions and overcharging me for the bills so he could spend it on friends and beers at his local pub, well, I've had enough.

To answer your questions:

1) House was purchased for £180.000

2) My dad put down £40,000 as a deposit.

3) The mortgage was £143,000 (140, plus fees)

4) The agreement was the mortgage would be split between myself and my brother (the uncle took over his share later on, my brother moved out)
At the time, I and my brother thought my dad had purchased an entire third of the property, but he didn't, he only put down £40k, not £60k, so he never paid towards the mortgage, but probably should have done

5) Zoopla says the Zenindex for my post code is - £216,630
And the average asking price is - £280,191
So I would estimate it would sell for £210 to £215k

Thanks very much for helping me out, I appreciate it more than you know.

AdamPD

BitterAndTwisted wrote: »

All three of you have acted like irresponsible fools by not getting a Deed of Trust drawn up at the very beginning.

We didn't know anything about trust deeds.

You put in nothing and are expecting to gain 25 to 30 grand?

Why would a child seek to disadvantage their own father so ruthlessly?

See my above post as to why

DVardysShadow

AdamPD wrote: »

1) House was purchased for £180.000

2) My dad put down £40,000 as a deposit.

3) The mortgage was £143,000 (140, plus fees)

4) The agreement was the mortgage would be split between myself and my brother (the uncle took over his share later on, my brother moved out)
At the time, I and my brother thought my dad had purchased an entire third of the property, but he didn't, he only put down £40k, not £60k, so he never paid towards the mortgage, but probably should have done

5) Zoopla says the Zenindex for my post code is - £216,630
And the average asking price is - £280,191
So I would estimate it would sell for £210 to £215k

Looking at what happens so far

• Your father put in 40,000 on a purchase costing 183000. He has paid nothing since. His share is [40/183] * 100% = 22%
• We will assume that your uncle and your brother did a deal which leaves your brother with no reason to claim so his share is 0%
• Your uncle has put nothing in so his share is 0%
• Your share assuming you have taken on the whole mortgage is the remaining 78%.

Looking at a sale for 210000

• Your father should get £45900 [22%]
• You should get £164,100, but as you have taken on the whole mortgage, you must pay it off from your share, so if there is still £143,000 outstanding, you should get £21,100

Remember that this is what i fair - not necessarily what a court would order, because courts are not about fairness.

AdamPD

DVardysShadow wrote: »

Looking at what happens so far

• Your father put in 40,000 on a purchase costing 183000. He has paid nothing since. His share is [40/183] * 100% = 22%
• We will assume that your uncle and your brother did a deal which leaves your brother with no reason to claim so his share is 0%
• Your uncle has put nothing in so his share is 0%
• Your share assuming you have taken on the whole mortgage is the remaining 78%.

Looking at a sale for 210000

• Your father should get £45900 [22%]
• You should get £164,100, but as you have taken on the whole mortgage, you must pay it off from your share, so if there is still £143,000 outstanding, you should get £21,100

Remember that this is what i fair - not necessarily what a court would order, because courts are not about fairness.

Thanks

The outstanding balance on the mortgage right now is about £133.000
The uncle did pay towards the mortgage for 2 years, but stopped in Oct 2010
We haven't heard or seen him since May of 2011
My father wants to use his own solicitor "friend" who says he can help sell the house and my dad says he can forge the uncle's signature. (...don't ask, I don't agree with that at all)
That way, the uncle doesn't get a share, so there's been no agreement between him and my dad.

The problem is, I'm on benefits, as is my dad, so the government helps pay towards the mortgage with SMI
The rest of the mortgage, is being paid by lodgers, who are now in my old double bedroom, so the mortgage is covered

DVardysShadow

AdamPD wrote: »

Thanks

The outstanding balance on the mortgage right now is about £133.000
The uncle did pay towards the mortgage for 2 years, but stopped in Oct 2010
We haven't heard or seen him since May of 2011
My father wants to use his own solicitor "friend" who says he can help sell the house and my dad says he can forge the uncle's signature. (...don't ask, I don't agree with that at all)
That way, the uncle doesn't get a share, so there's been no agreement between him and my dad.

The problem is, I'm on benefits, as is my dad, so the government helps pay towards the mortgage with SMI
The rest of the mortgage, is being paid by lodgers, who are now in my old double bedroom, so the mortgage is covered

As I see it, when the uncle stopped paying towards the mortgage, he lost his share [talking fairness here, rather than what a court would order].

If your father is talking about forging, you should stay well clear, because this could cause you considerable bother later as a substantial beneficiary of the sale of the house, if your uncle goes to the police.

I think that legal ways of playing dirty are more in order here. If you can find your uncle, you could together threaten to sue him for the missed mortgage payments, but offer the option of signing his share over to you. But you do need to get a trust deed set up with your father to cover the Tenants in Common issues for the situation you will be left with.

AdamPD

Yea I am staying clear of the dirty/dodgy/illegal area, I won't have anything to do with it.

IF we did go after the uncle and get him to sign his share over (legally, of course), couldn't he turn around and say "my share is covered, because you have lodgers in my room"?

Just wondering

Thankyou again

DVardysShadow

BitterAndTwisted wrote: »

Yes, he could fight it in court but it would not be cheap.

All three of you have acted like irresponsible fools by not getting a Deed of Trust drawn up at the very beginning.


Look at it this way: your father put in £40k which on the face of it could be viewed as having purchased X percent of the property's value, so it would be entirely fair now that the total value has increased that the value of his percentage has also increased.

You put in nothing and are expecting to gain 25 to 30 grand?

Why would a child seek to disadvantage their own father so ruthlessly?

As I understand it, OP has been paying the mortgage. That is renting the money to buy the house and the money raised that way is very valid as equity. Indeed, I calculate that OP should perhaps get that amount of money.

AdamPD

Yes, mortgage has been paid since October 2005.
Thanks again for the advice, DVardysShadow.