Transfer of equity

Vrich85

Hi, I'm hoping for some advice.

I bought a property with my brother in 2008 with the intention of keeping it for 3 years, making a profit and parting ways. Obviously, issues in the economy put a stop to that.

Since buying the property, we have both got married and so I have moved out. We are now looking to transfer my name off the mortgage and replace it with his wife, and we are at loggerheads when agreeing an amount that I am due. We have agreed a %age share, but There is a significant difference between the 'zoopla estimate'/value the mortgage company hold and what the property would sell for currently (about £20k). Has anyone been in a situation similar to this that can offer any advice.

I have also agreed that I am to get my share when the property is sold, to help my brother and sister in law out. In which case, am I within my rights to ask that the amount should increase by a certain amount each year, at a comparable rate to if it was an a savings account for the same period?

Thanks in advance for your help

getmore4less

If you can't agree a value then the market can do that for you, SELL.

If you can agree a value but they can't raise the cash to buy you out, then you need to decide if it will be a loan or you retain an equitable share(or combination)

IF you decide it is a loan any uplift on the debt will be taxable.

if you retain some equity you need to decide how you manage maintenance and any improvements.

ExpertAdvice

Transfer of Equity can be done provided the existing lender agrees to it. Their decision would depend on whether your brother and sister in law can afford the mortgage on their own without your income. Also, they would do a credit check on her. Provided everything is ok, it shouldn't be a problem and you would need to go through a solicitor to transfer the equity.

As far as the property value is concerned, you might want to get a valuation done through an independent surveyor. However, I'm not sure if that would be any good as you are not planning to sell the property now. The value might be different when you actually sell it. Though it would help you make your decision regarding your share in the property etc etc.

steampowered

The value of a property is what people are prepared to pay for it. It is a bit ridiculous to claim that the value of a property is higher than what it can actually sell for.

In which case, am I within my rights to ask that the amount should increase by a certain amount each year, at a comparable rate to if it was an a savings account for the same period?

Only if it is agreed that you will receive a fixed amount plus interest (i.e. without getting any share of the equity).


If you have a share in property, that share would normally increase if property prices increase. Money can either be used to get savings interest or investment returns. It wouldn't be fair for you to benefit from investment returns AND get interest - that is double counting what could be done with your money.

Thrugelmir

Vrich85 wrote: »

In which case, am I within my rights to ask that the amount should increase by a certain amount each year, at a comparable rate to if it was an a savings account for the same period?

And if property prices fall?

Vrich85

We are trying to agree what the value of of my share currently is. Then I am proposing that if they don't want to release the equity from the property to give that to me now, I'd receive the agreed amount (plus an agreed amount of interest) when it comes to sell, regardless of the achieved sale price at the time.