Tenants in common separating

GleamingParsnip

Talking about restoring the original deposits, I realised there is a complication. £170k was the original valuation, and we do own 50% each, but the deposits were uneven. £40k of the deposit was cash, which I supplied.

The previous owner of the house was Kristen, Kim's mum. She sold the house to us at £100k - the difference being a gift to Kim.

getmore4less

Talk about drip feeding.

What was the agreement when you bought?

If you put those deposits down and paid mortgage 50:50 proper equitable shares would not be 50:50.

AnotherJoe

GleamingParsnip wrote: »

What I'd like to find out about is what could happen if Kim moves out and I take over the current mortgage until the end of its term, then buy her out at that stage (Summer 2020). Is there a special name for that kind of arrangement because I am finding it hard to google?

Yes, it’s called “a big financial and legal mess” when the two peopel quarrel over who owns what and is due what now that one persons been paying the mortage, the other rent elsewhere, and one or both change their minds about what was agreed.

Sell to a third party or one of you two and get it done quickly and cleanly.

Tom99

GleamingParsnip wrote: »

Talking about restoring the original deposits, I realised there is a complication. £170k was the original valuation, and we do own 50% each, but the deposits were uneven. £40k of the deposit was cash, which I supplied.

The previous owner of the house was Kristen, Kim's mum. She sold the house to us at £100k - the difference being a gift to Kim.

[FONT=Verdana, sans-serif]So if we say house has gone up from £170 to £200:-[/FONT]
[FONT=Verdana, sans-serif]Amount her deposit bought – 70/170*200 = £82,352[/FONT]
[FONT=Verdana, sans-serif]Amount your deposit bought – 40/170*200 = £47,058[/FONT]
[FONT=Verdana, sans-serif]After taking above into account, you split 50/50 after mortgage so you each get:[/FONT]
[FONT=Verdana, sans-serif](200,000-82,352-47,058-54000)=16,590/2=8295[/FONT]
[FONT=Verdana, sans-serif]So you owe Kim 82,352+8295=90647[/FONT]
[FONT=Verdana, sans-serif]Your equity is 47058+8295=55353[/FONT]
[FONT=Verdana, sans-serif]Who paid the fees on top of the £170 purchase price because that also needs to be factored in?[/FONT]

getmore4less

in the absence of an agreement/intent and the current value here are some typical examples based on the current information.

value now & then £170k
deposits her £70k, you £40k, mortgage £60k(paid 50:50) outstanding £54k

1. Proper equity split
split is 70+30:40+30 100:70 58.82% 41.18%

proceeds are that % value less 1/2 the mortgage left(any uplift in value at 58.82% 41.18% ratio.

her £73k you £43k to buy out you need a mortgage of £127k + 58.82% of any uplift in value

2. Get the deposits back split 50:50

After deposit there is £60k left - mortgage £6k 3k each + 50% of any uplift in value

you get back

Her £73k you £43k to buy out you need a mortgage of £127k + 50% of any uplift in value

3. own 50:50 no deposits back

simple 50% current value - 50% mortgage

That's £57k each to buy out you need a mortgage of £113k + 50% of any uplift in value



(as Tom99 says feeds for purchase need to be include in the purchase price/deposits for 1&2)