Mortgage Equity mess

Clueless89

Apologies in advance for the long and complicated story I am about to tell. I will be seeking legal advice (if I can afford to!) but would value some opinions.

My ex partner (and father of my children) and I bought a house in 2007 for 190k. In 2010 we split up, myself and our very young children moved out as I could never afford to maintain the house on my own working part time. I’ve been renting ever since as I can only work part time and will never afford a mortgage on a house big enough for the three of us alone.

My ex paid the mortgage from day 1 as our son was 1 year old at the time and I had just gone back to work part time. I continued working part time and we had a second child. After moving out, I’ve been paying rent for the past 8 years. He continued with the mortgage. I stayed on said mortgage. My intentions (which I realise now were unwise) were to stay on it whilst he paid it off and it gained equity and then have him buy me out when I was in the position to buy so I could use my share of the equity as a deposit.

During this time, (unknown to me until recently) my ex fell into arrears on the mortgage and almost had the house repossessed. The arrears is now cleared but my credit rating is ruined for the next 6 years meaning even if i did have the means to secure a mortgage I probably wouldn’t have a hope in hell of doing so.

Now long overdue, I want off the mortgage. Any money I’m due is clearly better in a ISA of some description than me risking staying on the mortgage. He has a decent income - at least £60k (more than we had combined when we took out the mortgage) so I’m hoping the mortgage lender will allow a transfer of equity and for him to release me some equity.

Figures:

Purchase price: £190k

Deposit: He put in £35k to the mortgage from his previous property. I signed a legal document stating he would be entitled to his deposit back before we split any equity unless we got married, which we didn’t. I’m still happy for him to have that back. I was younger than him (22 at the time) and had no savings, I didn’t put in anything.

Mortgage balance left £133k

Zoopla valuation (I realise this isn’t an accurate guess and well get proper valuations) £218k

Equity: 218 - 133 = £85k - his £35k = £50k/£25k each.

Considering the position he put my credit rating in and the fact we have children and the effect that has on my career and income I feel like it is fair of him to buy me out and that I shouldn’t walk away with nothing.

I’ve initially said to him I’ll accept £15k (plus solicitors fees) (which he agreed to) if he gets me taken off the mortgage and pays me out by the end of the year. He’s not the most proactive of people so I’ve said to him if he doesn’t sort out the remortgage/ToE by then (as only he can do the affordability checks etc) then I’ll be demanding 50% of the equity which I could have done off the bat and what legally I should be entitled to?

After initially saying I should only be entitled to 50% of the equity based on the value the property would have been when I moved out in 2010 he has conceded on my initial offer of the £15k.

It’s worth mentioning here that he found himself in the same position with the ex he bought his first house with (he paid all mortgage payments on that too) and she walked away with £20k which is why he made me sign the trust deed before we took ours out. The difference here is we have children, I’ll probably never get on the property market without a partner and I’ve also paid more rent than he’s paid mortgage in the past 8 years.

My concerns are his credit rating is probably crap too - what if they won’t let him remortgage in a sole name - what if they won’t let him release any money? Are guarantors still a thing? His dad is quite wealthy so maybe that would be an option.
Failing that am I going to end up with a mountain of solicitors fees fighting him to sell the house?

Is what I’m asking fair (and legal) or am I completely wrong about my legal rights in terms of the equity?

butterflybook

Dependant on the lender the mortgage is with currently they are almost certainly going to want a period of time usually 12 months of stable mortgage payments being made. They then made look to allow the mortgage to be taken in his sole name but only if affordability is not an issue. Its likely his current lender is the only lender for consideration unless the arrears are a good few years old then there may be other options.

The usual starting point in terms of equity are 50/50 and go from there he could argue he has paid the mortgage all those years but you could argue you have let him live in the house - your half rent free....

Its swings and round a bouts

Good Luck

Clueless89

Thanks for your reply. He has been paying the mortgage every month on time since he got into the mess/arrears in 2013 so he does have 12 months consecutive payments, yes.