Joint ownership with ex-partner - how to resolve?

asparagus18

Looking for advice on the following situation:

Jointly owned property (tenants in common) for 13 years, not married, no children, 50:50 split of mortgage costs and bills up until now.

I have not lived at the property for nearly 4 years, as we had a long-distance relationship, which broke down a year ago. Despite this, I continued to pay him 50% of the mortgage, but no bills anymore during this last year.

This arrangement is no longer sustainable for me, as my own living costs have recently increased (moved from living with family to rented flat), plus I want to sever all ties related to this relationship.

My possessions are packed up and will be collected from the house in a couple of weeks.

We have started negotiations as to how to resolve the joint ownership (via email, as he won’t speak to me on the phone), and sadly, it is proving tougher than expected. For me, the obvious course of action would be to sell and split proceeds but he is adamant he wants to stay and buy me out. I would be absolutely ok with this, provided the buy-out figure and a few other aspects (timeline) etc. are acceptable. At present, none of it is and we seem to be heading towards an impasse.

My estimate is there is ca. £40K equity in the house, hence I’ve asked for £20K, to be paid in 5 years time or when the house is sold, whichever is sooner. I think being prepared to wait is a considerable concession on my part, but he says he will not agree to any time limit at all. His counter-offer is £15K. He could just about get a mortgage in his name only for the remainder of the balance, but not for any additional lending to buy me out with.

Figurewise, we could meet in the middle (he’s a stubborn b*****d though!), or have a valuation of the house done first – not sure he’d agree to that and he won’t even give me the current mortgage redemption figure (will have to call the lender myself).

Am I being unreasonable not wanting to wait indefinitely? What do you normally do in such a scenario? Probably set up a Deed of Trust, but what should it contain in terms of timeline and otherwise? Initially, he seriously proposed to just give me a letter written by himself and witnessed. I don’t think so.

Another complication is there is a Charging Order on my beneficial interest in the house (Restriction K), for a debt in my name only. This means the house cannot just be transferred into his name, as the restriction would remain, despite my name being removed from the deeds. With this in mind, selling to a third party would really be the best option, but as I said, he is totally opposed – and I would like to respect his wish if possible, as I still care about him and know that having to sell and move could destabilise him even further.

To make matters even worse: I don’t live in the UK but in another EU country now, which makes it difficult to take any practical steps in order to move the matter forward, be it consult a mediator, obtain legal advice, or even get a valuation of the house done under my own steam.

I know I could play hardball, just stop payments and wait for him to approach me once he is willing to sell – which could be 5 years or more. On paper, I’d still be entitled to 50% of the proceeds then (which I wouldn’t even want to claim as it would be unfair) but this would most likely result in a legal battle, which I want to avoid at all costs. I couldn’t do this to him.

I’m not after drama, conflict, a power battle or a tug of war. All I want is my fair share, and for him to be able to stay in the house. If that turns out to be impossible, so be it, but I need to go through all options before admitting defeat.

Sorry about the long post – any input would be much appreciated, as it’s virtually impossible to be aware of all the angles yourself, especially under stress such as this.

Many thanks
asparagus

DAKOTA45

Hi Asparagus… How much is the Charging Order for? If it's in your name, you will need to deduct that amount from your share of any equity...

Dakota45

Kynthia

I think you are being more than reasonable in being prepared to wait and still paying 50% of the mortgage. I think I would have negotiated to pay less than 50% after a few months as he is getting the benefit of living in the whole property and you are having to pay living costs elsewhere too.

How sure are you about the amount of equity? Find our the redemption value now and do some research on recent sale prices of similar properties. He is not unreasonable not wanting to sell if he can buy you out and a judge would agree, so your debt shouldn't be levering to make him lose his home. However if he can't afford to buy you out then a judge would think you've waited long enough. However being abroad makes it difficult to pursue this legally to force a sale. If £15k isn't too far off your share of the equity then take it if it means getting things sorted, you stop forking out each month, and there's no court costs to deduct from the equity due to forcing the sale. However only a solicitor could sort the funds being used to remove the charge so you'd need to arrange that.

elsien

But if he's not going to pay you for another 5 years, your share of the equity will have increased by then, surely?

AdrianC

elsien wrote: »

But if he's not going to pay you for another 5 years, your share of the equity will have increased by then, surely?

If the deal is "50% of any equity to be paid in 5yrs", yes - but, of course, it may decrease too.
If the deal is "£20,000 to be paid in 5yrs", no.

getmore4less

DAKOTA45 wrote: »

Hi Asparagus… How much is the Charging Order for? If it's in your name, you will need to deduct that amount from your share of any equity...

Dakota45

This ^ will need fixing.

I can see this getting messy if you try to do force it in any way, like stop paying, charging him rent or getting a lodger into your share.

if he does not have the money and get a mortgage in his own name you won't be able to get out without a sale.

currently he holds all the cards.

Hope they get a new partner that wants to share the house with them that will redress the ballance.

TBagpuss

It would be open to you to make an application to the court under ToLaTA to force a sale. If he refuses to cooperate then he could be liable to pay your costs as well as his own.

It is extremely generous of you to be willing to delay receiving your share of the equity.

In such cases, normally you would have a formal agreement which would set out the circumstnaces in which you were to receive your share of the vlaue of the property. Normally this wouldbe expressed as a % of the value of the house, rather than as a % of the equity or a fixed lump sum, as in effect, you are agreeing to continue to invest your money in the house. If you simply agree to a fixed lump sum then you are losing out on the return you could have got on that money if ou invested it elsewhere for that period of time, and on any increase in the vlaue of the house.

Normally you would want the agreement to define 'trigger points' for the money to be paid (and for the house to be sold if your ex can't pay you and get you relased from the mortgage at that point)

Obviuously one trigger would be the fixed date (5 years, if that is what you agree on) but you might also want to have other triggers such as if he marries or has a new partner , if he goes into arrears on the mortgage, if he fails to maintain the property or fails to keep it fully insured)

The agreement would need to set out the responsibilities you each have - this would ned to include provision for him to pay the mortgage and indemnify you, for him to maintain appropriate buiildings insurance and to provide you evidence of this, and for him to keep the property in a good state of repair ( so the value does not deteriorate).

To be honest, if he is already trying to bully you into accepting less than a full share of the vlaue (and if the £15K was a fiar share he would be falling over himself to provide you with copies of the valuation and mortgage redemption figures he had used to calculate it) I would be very cautious about agreeing to let him stay and to delay getting your share of the equity back - do you really want to be stuck in a financial relatsionhip with him for another 5 years?

Go and see a solicitor. Get some advice about wharre you stand, decide what you are willing to agree to and get a formal letter sent to him making your proposals, including giving him a deadline to respond and making it clear that you will force a sale if you cannot come to a fair settlement

asparagus18

[FONT=&quot]Thanks for all of your input – some really good points in there and plenty of food for thought.[/FONT]

TBagpuss wrote: »

It is extremely generous of you to be willing to delay receiving your share of the equity.

Thank you. I was beginning to doubt whether I'm acting reasonably at all in the whole saga! Outside perspective is so useful.

[FONT=&quot]Re. Charging Order: it’s £7K but the amount is irrelevant as it would fall away once the house is sold. Before anyone says this is wrong, please [FONT=&quot]check here[/FONT]:[/FONT]

[FONT=&quot]https://forums.moneysavingexpert.com/discussion/1839539[/FONT]


[FONT=&quot]I have the relevant figures now and £15K is a fair amount.[/FONT]

[FONT=&quot]He won’t budge on the (indefinitely!) deferred payment[FONT=&quot] as he doesn't have [/FONT][/FONT][FONT=&quot]£15K now.[/FONT]

[FONT=&quot]Of course I don’t want to be financially tied to him for years to come but the only alternative seems to be to force the sale legally. Difficult to do from abroad, and I’m pretty sure I’d have a foe for life [FONT=&quot]if I were to [FONT=&quot]go down that route[/FONT][/FONT].[/FONT]


[FONT=&quot]Fact is I cannot afford to pay half of the mortgage anymore, which I’m going to tell him shortly. Let’s see how he reacts and take it from there.[/FONT]

[FONT=&quot]asparagus[/FONT]

McTaggus

Hi Asparagus,


It sounds like a difficult situation, but unfortunately it is often the case that ex-partners don't tend to negotiate on a fair basis - particularly if it wasn't an amicable split. The fact that you haven't lived at the property for quite some time but have continued making payments is laudable, however if he is unable to meet your terms for buy out then I can't help but think that your only point of recourse is to force the sale (or at least threaten to do so via a solicitor to see if that can force a negotiation that would be more reasonable to you.


I faced a similar situation. I had purchased a house with a (now) ex-partner, and when we split up I took ownership of all of the bills, however he was still named on the mortgage and property deeds. He refused to sign either of these over to me, without receiving back his original deposit that he had put into the house and the full sum of contributions he had made to the mortgage prior to our split. Unfortunately, the house was hit by the 2008 crash (we bought just 2 years earlier), and was also in 40K negative equity, so there was no way I could sell the house and pay him back from remaining equity. I moved abroad with work, and wasn't even living in the house but paying all the bills (mortgage etc.) without support from him and was also unable to sell the house because he refused to give permission.


In the end, I had no choice but to threaten to force the sale, and stated that unless he signed everything over without further delay then I would also make him liable for 50% of the negative equity. He signed everything over, and yes I had to pay the negative equity, but the relief at no longer being financially tied to him or under someone else's financial "thumb" was well worth it.


It's also not impossible at all to do from abroad - I did mine from the Middle East using a UK solicitor, so you shouldn't face any issues!

JAS2015

Re: Charging Order
I've just been through this with my ex partner. In most cases, this is correct. However, if the buyer/your ex partner INSISTS the restriction is cleared from the title before completion, then you will need an undertaking from your debtor that the restriction will be lifted. To do this, they will want payment of the debt.

DAKOTA45

Asparagus… If there is £40k equity, your share of the equity would be £20k, less the £7k debt, (which you admit is yours). Your partner is being quite reasonable in offering you £15k. I would accept it, but say that if there is an increase in equity before the house is sold, then you get a pro rata share of it. But if there is any interest being added to your Charging Order, then you would need to take that into account too.. TB