How much to buy my ex out?

Jen1984_X

Hi all, just after a bit of advice here....
My ex and I purchased a house a couple of years ago and I'm looking to buy him out and have been giving some thought to how much I'd have to pay him.  
- Property was purchased for £350,000
- His deposit was £95,000
- My deposit was £5,000
- We've been paying the mortgage 50/50 since we got the house, he moved out a few months back but has still been paying the mortgage.

Am I right in thinking that if I want to buy him out it will be the value of the house when revalued - let's say £400,000 for convenience (wishful thinking!) 
MINUS what's left to pay on the mortgage (which is £250,000) 
MINUS our deposits (£95,000 and £5,000)
Which amounts to £50,000 - so he would get half of that back and his £5k deposit.

So I'd have to pay him £30,000 and then look to get the place remortgaged on my own.
I'm a little out of my depth with knowledge here so any advice anyone can give before I get some professional advice would be greatly appreciated.

steve866

Jen1984_X said:

Hi all, just after a bit of advice here....
My ex and I purchased a house a couple of years ago and I'm looking to buy him out and have been giving some thought to how much I'd have to pay him.  
- Property was purchased for £350,000
- His deposit was £95,000
- My deposit was £5,000
- We've been paying the mortgage 50/50 since we got the house, he moved out a few months back but has still been paying the mortgage.

Am I right in thinking that if I want to buy him out it will be the value of the house when revalued - let's say £400,000 for convenience (wishful thinking!) 
MINUS what's left to pay on the mortgage (which is £250,000) 
MINUS our deposits (£95,000 and £5,000)
Which amounts to £50,000 - so he would get half of that back and his £5k deposit.

So I'd have to pay him £30,000 and then look to get the place remortgaged on my own.
I'm a little out of my depth with knowledge here so any advice anyone can give before I get some professional advice would be greatly appreciated.

Was his deposit £5k or £95k ?

Jen1984_X

steve866 said:

Jen1984_X said:

Hi all, just after a bit of advice here....
My ex and I purchased a house a couple of years ago and I'm looking to buy him out and have been giving some thought to how much I'd have to pay him.  
- Property was purchased for £350,000
- His deposit was £95,000
- My deposit was £5,000
- We've been paying the mortgage 50/50 since we got the house, he moved out a few months back but has still been paying the mortgage.

Am I right in thinking that if I want to buy him out it will be the value of the house when revalued - let's say £400,000 for convenience (wishful thinking!) 
MINUS what's left to pay on the mortgage (which is £250,000) 
MINUS our deposits (£95,000 and £5,000)
Which amounts to £50,000 - so he would get half of that back and his £5k deposit.

So I'd have to pay him £30,000 and then look to get the place remortgaged on my own.
I'm a little out of my depth with knowledge here so any advice anyone can give before I get some professional advice would be greatly appreciated.

Was his deposit £5k or £95k ?

Sorry yes MY deposit was £95k and his was £5k

DG88

This can be fairly complex. Were you married? If not, it is a question of trusts of land. Did you buy as tenants in common, or jointly? Does he agree to his share being bought?

Jen1984_X

Thanks for the response. So no we weren't married and it's a joint mortgage we have.
He's open to the idea of his share being bought, I think he's torn between me buying him out or us just selling the house, whatever is going to be in his best interests financially (I'm not sure which option would be best for him tbh!)

DG88

It is going to be much easier if he is onboard, obviously! Strictly from a legal point of view worst case scenario is that your ex can claim 50% and he may demand you buy his 50%. However, this is unlikely as you contributed a far larger deposit. You could try and calculate the shares by calculating the percent you each contributed and use that ratio to the current value, or as you mention in the original post you can deduct each of your deposits and then apportion a 50/50 split to the remaining equity.

My advice as a family lawyer, is to keep it amicable and as casual as possible.

blue_max_3

Firstly, do you want to stay in the home? And then can you afford to take on the mortgage on your own?
If the answer is yes and yes, then put your offer to him. It may be best to get an independent valuation (RICS) as agents have a habit of overvaluing for marketing purposes. It may be as simple as that.

getmore4less

Even with joint tenants you can have  interests that are not 50:50, that could create debt to the estate on death when the property passes by survivorship.


what was the agreement when you bought?  usual one are  
get you money back split to mortgage or
equitable shares based on cash and debt servicing or
something else like a combination of the above

get your money back is like an interest free loan  you have done those numbers.

for equitable shares
starting with £350k    £95k, £5k,  £250k(mortgage £125k each) 
you should also include all costs and who paid them in the calculations.

also why is the mortgage still £250k after a couple of years of paying it?

£220k £130k  or  62.857%  37.143%

buy him out, say value is £400k, he gets (£400k* 0.37143) - £125k = £23,572