Ex wants his “share” of house. Help please!

Alfisti80

Hi,

I’m in desperate need of help, and wondered if anyone may be able to provide assistance. I shall try to keep this as concise as possible.

My ex and I purchased our house in 2005. We’ve had our current mortgage for just over three years. Everything is 50/50 joint. In 2015 when we changed mortgages the monthly payments went from his account to mine. We split shortly after and he moved out. It was all very amicable, and still is to this day. He stayed on the mortgage as I wouldn’t have got one alone at the time. He told me he wouldn’t want anything to do with the house, and as far as he was concerned it was mine. That maybe one day we could arrange me buying him out, but that was very casually. He has since got married and had a child.

Fast forward to present day and one of his family members is selling a house and has agreed to sell it to my ex cheaply. As the family member is ill and practically palliative in his needs the sale needs to happen quite quickly.
My ex has come to me basically wanting a piece of our house in order to get a deposit. He’s suggested one of three ways. It’s very early stages and I don’t know what’s possible, but these are the options he’s proposing:
- we sell up
- he borrows against his equity in our house
- I buy him out of his share of profits which he estimates to be approximately £30k.

Ideally I would like to buy him out, but I’m worried I won’t be approved for the remainder of our current mortgage, let alone an extra £30k on top.

We purchased the property for £98,500 in 2005, we have £63k left owing on our repayment mortgage, and the same properties on our street are going for approx £120-130k currently.

What are my rights and options? I am so worried I will lose my house. On a personal level I feel a bit attacked as between him and his wife they earn around 5x more than I do. But I understand there is no room for emotion when it comes to financial and legal matters.

I’m about to start a new job with better pay and have a lodger paying rent into my account, but I know mortgage providers will only go on past earnings, not what I’m about to start earning.

Whilst I want to keep things amicable as possible, I also want to ensure I don’t get swindled and left out of pocket (and potentially out of house), so would like to be armed and informed of my rights. Does the fact he’s not lived here or paid in for the last few years have any effect on his rights at all? Clutching at straws, I know.

Thank you for reading and taking the time to reply.

tacpot12

You haven't said whether he has been paying the mortgage since he left, but I assume he has. If so, you both own 50% of the equity in the house, about £60K in total. This seems to be agreed as you have discussed his share of the profit being £30K.

He doubt he will able to borrow £30K against an equity of £30K, and I would suggest that you should not allow any loan against the property that is secured against any of your equity. I would make him do the investigation into whether he can borrow against his equity.

Selling up is an option, but there will be some legal costs and possibly an early repayment charge (ERC) to your mortgage company; perhaps unlikely after three years, but worth checking what the ERC would be. This will leave you will circa £28-30K, which will not be enough to buy somewhere outright, but might be enough to put down a substantial deposit and leave you with a mortgage you can afford.

Remortgaging is the final possiblity. I think you should call the mortgage company to ask about remortagaging to borrow another £30K, and if they can't help, it might be worth consulting a mortgage broker to see if they can find you a deal that would work. If you have to remortgage with another company, I would suggest you tell your ex that you expect him to go 50/50 on the fees, so he won't get quite £30K back. The benefit to him is that he is off the your mortgage and free to take out another for his new property, plus he has nearly £30K to put towards it.


Good luck; do let us know how you get on.

Alfisti80

Thank you so much for your response.

Just to clarify, he has not paid anything since he left. The mortgage has been paid by myself alone from my sole bank account since he moved out in late 2015.

If I have to agree to one of his terms I would prefer to buy him out. My concern there would be whether a mortgage provider would allow me singularly to have a mortgage for £93k on my current wage (which is about to go up). I really don’t want to move out of my home if I can help it.

Thank you for your advice. I would never have thought to make him pay 50/50 for the fees.

I don’t want a war, would like to stay amicable if possible, but I will fight for my home.

Thanks again Tacpot.

Thrugelmir

Alfisti80 wrote: »

Whilst I want to keep things amicable as possible, I also want to ensure I don’t get swindled and left out of pocket (and potentially out of house), so would like to be armed and informed of my rights. Does the fact he’s not lived here or paid in for the last few years have any effect on his rights at all? Clutching at straws, I know.

Were you married or just living together?

Alfisti80

Hi Thrugelmir, we were living together, not married.

Thrugelmir

Alfisti80 wrote: »

Hi Thrugelmir, we were living together, not married.

Then you'll need to compromise with your ex. There's no question of rights. However your ex could take you to court to obtain his share of the equity. An expensive option as the costs are high.

What was the property worth in 2015? This should be the base point for division of the equity. Suspect that this will be a lot less than £30k. Given you've made 3 years of capital repayments since plus some capital appreciation in the property price.

Make an offer and negotiate from there.

ACG

Why not offer him £30k minus 50% of the mortgage payments for the last 3-4 years?

You can not really have 50% of the equity on a property you have not been paying towards, I suppose you can but I would argue it.

If he needs the money quickly he will agree to something over nothing as a court case could take months to be heard in court and no guarantee he would get more than what you offer.

How much do you earn now?
How much will you earn in the new job and when do you start?

Assuming around £17k plus on the new job then you can probably afford to remortgage and get him something, maybe not £30k but enough to give him something.

Dont forget, if he wants to force a sale:
Solicitors costs (for them and possibly you),
Estate agents costs (for both),
Legal costs for selling (for both),
Months (for both).

I would personally say the ball is in your court to some extent.

jonesMUFCforever

If you are in a position to offer anything - I would offer the £30k minus ALL of the repayments you have made since you split.
I am assuming you have no children here or I would not give him a penny.

antrobus

TOLATA applies and the principles of 'equitable accounting'
https://www.familylaw.co.uk/news_and_comment/everything-you-always-wanted-to-know-about-tolata

TOLATA takes account of 'occupation rent' i.e. the benefit the remaining co-owner gets from living in the property. Whether this is more or less than the costs incurred - mortgage interest, whatever - depends on the numbers.

As always, taking this to court is going to cost. It is always best to reach a settlement.

comeandgo

jonesMUFCforever wrote: »

If you are in a position to offer anything - I would offer the £30k minus ALL of the repayments you have made since you split.
I am assuming you have no children here or I would not give him a penny.

There has also been a lodger living in his half share house, if you start going down the play dirty it could turn round and bite your bum. He would be entitled to half of the income from the lodger.

antrobus

Alfisti80 wrote: »

....
What are my rights and options? .... .

Well put it this way. He is the legal owner of 50% of your house. You can't sell it or even remortgage without his consent.

You will need a lawyer to put whatever agreement you reach into effect.