Mortgage and divorce settlement?

stinking_dylan

Has anybody gone through or knows of the process of house selling post divorce?

A female friend of mine is looking for some advice. Her and her husband took out a joint mortgage on a property about seven years ago. After 4 years they split, and she stayed in the house with the four children and continued to pay the mortgage on her own.

The divorce settlement states that she retains the house until she remarries or the children turn 18 at which point she needs to pay her ex his share, being 40%.

Now, whats the normal procedure assuming that there is one? Is this 40% of the amount of the mortgage paid at the time of their split, taking into account appreciation? Or is it 40% of the total equity at the time of sale or settlement?

She is worried that it's 40% of the total equity, if so, that can't be right can it? He paid half the repayments for 4 years, then ceases to make payments but gets 40% of the total equity when the house is sold?!?

cal1_2

Hi
I went through the same thing last year. My ex wanted a Mesher Order in the divorce settlement (this is the same as what your friend has), ie, he would receive 35% of the total equity when I remarried, children finished education, co-habited etc etc. All the while I was paying the mortgage on my own. I did whatever I could (I begged, borrowed and stole.....well nearly;) ) so I could raise the funds to pay him out. He, by the way, was gutted because he saw this as his retirement fund:mad: for the future!!!
I managed to pay him out before settling for this Mesher Order as I felt exactly the same as your friend - why should I pay the mortgage, maintain the house etc etc and he benefit 35% from this when he hadn't contributed for, what would have been, 13 years????? No way!!!!
I'm afraid it will mean that your friend's ex will receive 40% of the total equity when the house is sold....not fair in my opinion. The law sees it from her ex's point of view also and he has had to wait xxx many years to receive any monies due to him and also she has been able to stay on in the house without uprooting the children, whilst he had to start again (in effect).
Sadly, a clean break settlement may have been a better option.
She may have to make some tough decisions, ie, if the house was sold now and she received 60% of the equity, could she manage to buy a house and maintain that new house? At the end of the day, if she bought a new house in just her name, 100% of any profit would be hers. Another option might be to try and pay him out now by raising 40% of the equity (? remortgage). Obviously I don't know enough about your friend's circumstances.
I wish your friend all the best, it's not a nice position to be in.
xx

stinking_dylan

Thanks cal1, not what she really wanted to hear, but now at least she can make plans.