Wife left....help with house equity..

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Hey all, after some advice relating to my current situ - as per title, sadly my wife has decided that our relatively newly married life isn’t for her and has left the family home this month. We were first time buyers, in May ‘17.

I’m staying in the house myself, for minimum of two and a bit years until our 3 year fixed term is up, and she will not be contributing any monthly financial support to the house, even though she’ll still be equally liable.

I want to be able to come to an amicable agreement with her in terms of how the equity is going to be dealt out at the point where that time is up, and we decide to either sell, or less likely, me remortgage in my own name.

Initially I have basically looked at what the house is worth to us at the point of her leaving now, based on our original purchase price in ‘17, and subtracting what we owe on the mortgage currently. I want her to agree to only ever accepting half of this value - minus the split of any fees should we go down the route of selling up, regardless of what the whole house equity is worth in two years time.

My question is - Is this fair and reasonable for me to work it out in such a manner.?

I’m potentially looking at this figure even though my own family contributed a sizeable amount toward our original deposit. I just want to look toward being amicable with her, so that in two years time the house process and divorce (likely doing at same time) will go smoothly. I’ve also looked at a separation order to lay these terms out, to aid the process further on.

Proper legal advice I know is the way to go, albeit incurring more cost I would struggle to afford currently, so any wise input would be great.
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  • Tom99
    Tom99 Posts: 5,371 Forumite
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    [FONT=Verdana, sans-serif]There are probably two sides to the coin.

    [/FONT] [FONT=Verdana, sans-serif]If your wife is stuck owning 50% of the house for the next two years why should she give you all of any increase in value?

    [/FONT] [FONT=Verdana, sans-serif]You will be occupying her 50% share so maybe she should charge you rent on that share?

    [/FONT] [FONT=Verdana, sans-serif]You will be paying all the mortgage interest so maybe that can be seen as a substitution for rent.

    [/FONT] [FONT=Verdana, sans-serif]You will pay the repairs but you are the one who is wearing out the house.[/FONT]
  • FBaby
    FBaby Posts: 18,367 Forumite
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    What you are proposing is standard arrangement when one stays in the house rather than sell, normally because of children. If your reason for not selling is that doing so and paying to come out of your fix term will end up costing more than what you are suggesting, then it seems a fair agreement.
  • davidwood681
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    Tom99 wrote: »
    [FONT=Verdana, sans-serif]There are probably two sides to the coin.

    [/FONT] [FONT=Verdana, sans-serif]If your wife is stuck owning 50% of the house for the next two years why should she give you all of any increase in value?

    [/FONT] [FONT=Verdana, sans-serif]You will be occupying her 50% share so maybe she should charge you rent on that share?

    [/FONT] [FONT=Verdana, sans-serif]You will be paying all the mortgage interest so maybe that can be seen as a substitution for rent.

    [/FONT] [FONT=Verdana, sans-serif]You will pay the repairs but you are the one who is wearing out the house.[/FONT]

    Jesus, wouldn't want you fighting my corner with advice like that.

    :eek:
  • Tom99
    Tom99 Posts: 5,371 Forumite
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    Jesus, wouldn't want you fighting my corner with advice like that.

    :eek:

    [FONT=Verdana, sans-serif]My comments were slightly tongue in cheek, looking at it from the other side. I can't see what's in the deal for the wife.

    [/FONT] [FONT=Verdana, sans-serif]Being offered a 50% share of the OP's greater deposit may sweeten the deal if the marriage was a short one.[/FONT]
  • DigForVictory
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    Aim to get the money settled faster than anything else? As her financial status is shackled to you & if she gets hacked off by that, she might do things that really make any remortgage more difficult even if it messes up her getting a roof over her own head. (She's married one once - she may regard that as a reasonable policy.)

    Besides which, either of you could meet the genuinely right person next week & being stuck in a shared mortgage might really spoil that. So unless you're planning to renounce all relationships for 24 months, I'd start looking at ways of taking over all the mortgage asap.

    Your family will of course want to support you & may not feel funding her is right but, from a pragmatic point of view, buying her out now and getting that legally knotted off is worth a bundle for the freedom of manoeuvre it then gives you.

    Lawyer up & best of luck.
  • nikh667
    nikh667 Posts: 13 Forumite
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    Thanks everyone for your response, it's good feedback and appreciated.

    Both of us certainly know the option of selling the house now would, without question, leave us with likely no equity remaining after all the fees are settled, so this option is out.

    Unfortunately I have covered all bases in terms of taking on the mortgage myself, family are unable to assist currently, and my wages alone aren't enough to remortgage the amount remaining on the house.

    I certainly do want the financial ties done and dusted - I do technically have grounds for divorce under the heading of 'unreasonable behaviour', but only have not followed this option yet due to it not being an ideal time financially to divorce at this time.

    Cheapest options in terms of that from what I can find are online services such as 'divorce-online'. The upside of this however is should I be able to do it, I could have a 'consent order' written up to set in stone the equity agreement - so that in two years time when we sell/I buy her out, we have a law binding agreement to follow.

    Ultimately I just want to make sure that whichever path I follow, my reasoning behind trying to agree a fixed amount for her, based on her *current* equity, sounds fair, realistic, and not unusual in these situations.
  • BrassicWoman
    BrassicWoman Posts: 3,206 Forumite
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    You have her capital invested

    She cannot do anything else with it while you benefit from it

    So no - your proposal does not account for her opportunity cost, so is unfair
    2021 GC £1365.71/ £2400
  • spirit
    spirit Posts: 2,886 Forumite
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    Mortgage free as of 10/02/2015. Every brick and blade of grass belongs to meeeee. :j
  • bertiewhite
    bertiewhite Posts: 1,904 Forumite
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    I bought a house in 2005 and split from my ex wife in 2010. The mortgage was solely in my name, she didn't appear on the deeds and she never contributed towards mortgage or bills.

    Despite all this, I got told she was entitled to half the equity as it was the marital home.
  • Comms69
    Comms69 Posts: 14,229 Forumite
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    Jesus, wouldn't want you fighting my corner with advice like that.

    :eek:
    But that is what anyone advising her would say... at least now you know.


    As an owner, you have the right to occupy and she cannot charge you 'rent', but she could ofcourse let someone else move in and charge them rent if she chose to
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