Some Advice regarding splitting a house!

Red13

Don't know if this is the right place for this but I thought I'd give it a try.

Me and my long term gf have been going through some difficult times and the suggestion is there that we call it a day - one of the problems is a joint mortgage on the house.

The option seems to be one buying the other out - but how does this actually work - would I buy her out based on the current mortgage - so half being 30k or based on the market value of the house?

Or - which seems more logical - if she buys me out of my half of the mortgage we then have a binding agreement if she sells the house of splitting any profit less money I've already received for half the mortgage and less any major expenditure she may have incurred - say a new kitchen.

Any suggestions would be helpful - thanks

silvercar

firstly one of you would have to agree on taking on all the mortgage. Can either of you afford this? Would your lender allow this, based on one income?

Then, presuming you paid half the deposit each, you would need to pay the other one roughly half the equity.

eg if the house is now worth £100,000 and you have a £60,000 joint mortgage, whoever keeps the house needs to take on that £60,000 mortgage on their own and raise (roughly) half the equity to give the person being bought out. So they would need to raise upto £20,000. Best way would be to take a £80,000 mortgage.

The other option is to sell the house, pay off the mortgage and split the equity. So selling the house for £100,000, clearing the mortgage and splitting the £40,000 equity gives you each £20,000 to start again with.

In practice that £40,000 is reduced by estate agent fees, legal costs, mortgage redemption fees etc so, if someone is going to pay off the other the £20,000 should be reeduced to reflect this.

BenL

I recently did what Silvercar has written.

Mortgage was £110K, house worth £150K.

40K equity split between both of us equally as all deposit and bills etc were split 50/50.

My ex took over the mortgage after the bank agreed she could afford it.

I got £20K - 1/2 estimated estate agent cost - 1/2 solicitors fees but then added on money for the fixtures and fittings.

I took some stuff like TV that I brought with me to the house when we first moved in and the PC as I had bought it myself as computer stuff is my sort of thing.

It took us just under 6 months to sort it all out but we weren't exactly pushing all the time to sort it out asap. Well my ex wasn't as she was living in the house still with me paying 1/2 the mortgage and bills and I lived with my parents until it had all gone through.

Ben