In process of being bought out of house by ex, but I'm not sure I want to go down this route anymore

frewbz

Hi all,

I am in desperate need of some advice from anyone who understand my situation and the legal ties with it. Basically, my partner and I split up a couple months ago (I didn't want it but she is set on her decision) and we own a house together. The current plan was that she would buy me out and I would sign over the house to her name. One issue is that we are tied into a 5 year mortgage that we can't change due to the very high change of contract fee, and I have been told that when I sign the house over after she buys me out fully she will own the house 99% and me 1% until the mortgage is eventually settled as well.

Now, I've been doing a lot of thinking and discussing with my family and I feel like it's in my best interest to actually keep ownership of the house for the duration of the mortgage so that I can at least benefit in some way from it. I've lost an amazing house that my uncle did thousands of pounds worth of work for free in (fence, kitchen and bathroom flooring, as well as tons of other little bits and pieces), and now she gets to reap all the rewards from that, meanwhile I’m stuck at my parents now for 5 years with my life turned upside down. I also know it’s very likely the house will increase in value within 5 years due to being Cornwall, in a great location and being a lovely, well-built semi-detached house that's already had thousands of pounds extra work done. I'm also going to be tied down in a mortgage for up to 5 years which will hinder my financial ability and certainly stop me from taking out another mortgage while I'm on this one.

Now, this is the complicated part and where I need advice on where I stand. We are halfway through the process of having me bought out where I have received the money I put in as the deposit already, but I have not signed anything yet. I have been told I am awaiting a solicitor’s letter that has been drawn up to say that she has transferred me my deposit, and for me to sign the house over to her entirely. Some info on the house is that we went in as joint tenants so I believe this means we both own the house 50/50? But there was a clause in place to protect her deposit amount as she paid a lot more towards the deposit due to being bought out of her house with her ex before me (can you sense a pattern here?). Anyway, I put in £5000 (£6000 including my help to buy ISA), but that was not included in what I would be bought out at and so we came to the mark of just 5k. She put in around 16 or 17k I don't remember exactly, but the clause in our contract stated that if we ever sold, she would get her 16k and I would get my 5k, and then any interest/equity would then be split 50/50 if I remember correctly.

Now, I said I have already received my 5k back, but this was not done via a solicitor, it was literally just a personal transfer of 2,000 and then 3,000 a few weeks later. She told me she has taken screenshots of it and sent it to her solicitor and it has been added in the paperwork I have to sign to say she has already paid the 5k.

I feel like it is in my best interest to actually try and keep the house, continue to pay half the mortgage for 5 years and then when it comes to it, either sell, or be bought out then but I will have at least gotten something out of it, opposed to settling for my 5k now and being financially stuck for 5 whole years. After all, I didn't want to split up and leave the house, but I had no choice because she put more money into it and I cannot afford to buy her out, I would have if I had the money.

The only other info I can note is that currently we are kind of amicable, but I know for a fact that she will hate me if I want to do this, but at the end of the day, she has shown me that she doesn't care about me or love me anymore and she's already seeing someone else after just weeks of splitting up, and I think now more than ever I need to put myself and my financial future first over someone who doesn't care about me anymore, as selfish as that might sound, my whole family have been advising this also.

I just don't know where I stand legally. She put more money into the house deposit than me, but we went in as joint tenants and I believe I still own the house 50% at this moment in time. Am I right in thinking that if I do not sign the solicitors letter making the house entirely hers, and give back the 5k she personally transferred me, and continue to pay half the mortgage then I am legally entitled to do this and keep the house ownership? Or do I have no leg to stand on? I feel like she is the type of person to get really nasty and threaten taking me to court over this, so any help and advice would be massively appreciated.

I am in the process of seeking legal advice from solicitors, but I thought there would be no harm in asking around as well. Many thanks to anyone who replies, I appreciate it a lot.

diggingdude

For me either im bought out for my share and my name comes off the mortgage or we sell the house, pay the ERC and each take a hit on the money. I wouldnt want to be liable after 4 years say if she stops paying the mortgage and it trashes my credit. Equally you for want to be paying the mortgage for years somewhere you don't live. 
In my view, and it's only my view, you need a clean separation and that's best from day one 

hazyjo

Totally agree with diggingdude! Clean break. Sell. Take the financial hit now. I've been in that boat 3 times and I can't imagine anything worse than still having any sort of  interest in the property 5 years later or forced contact with an ex.

The things you listed your uncle did may make a house more saleable (if liked by others) but prob not more valuable.

Have to say, I stopped reading, as will others. Can you shorten it and take out all the emotive stuff? I know you want to get it off your chest, but please just include facts.

getmore4less

Joint tents is not what many think as it really only applies when someone dies(survivorship).
The agreement on the beneficial interest is what matters.

Also the current actions would probably be considered as mutual agreement to sever the joint tenancy. 

Have you checked that the lender won't let the OH take it on without ERC.

Can OH get a mortgage on their own. 

Could you buy them out? 

What % is the ERC and mortgage size. 
 

frewbz

hazyjo said:

Totally agree with diggingdude! Clean break. Sell. Take the financial hit now. I've been in that boat 3 times and I can't imagine anything worse than still having any sort of  interest in the property 5 years later or forced contact with an ex.

The things you listed your uncle did may make a house more saleable (if liked by others) but prob not more valuable.

Have to say, I stopped reading, as will others. Can you shorten it and take out all the emotive stuff? I know you want to get it off your chest, but please just include facts.

I can't just sell though can I, as she won't want to? So my options are either accept the buyout but still be tied to the mortgage for 5 years, or keep the house and at least maybe gain something from it. Also, I'm not sure how to edit threads.

frewbz

getmore4less said:

Joint tents is not what many think as it really only applies when someone dies(survivorship).
The agreement on the beneficial interest is what matters.

Also the current actions would probably be considered as mutual agreement to sever the joint tenancy. 

Have you checked that the lender won't let the OH take it on without ERC.

Can OH get a mortgage on their own. 

Could you buy them out? 

What % is the ERC and mortgage size. 
 

Apparently she has made the lender aware of the situation and that she will be solely funding the payments, so I can only assume they are okay with this.

Doubtful that she could remortgae without a guarantor, but I don't know anymore.

I cannot afford to buy them out else I would have.

Mortgage size is around £135k, it was a section 106 discounted sale property valued at 161,000 after the dicount (230,000 open market). I'm not sure what the ERC is but I have just checked on an ERC calculator and it comes back at £6,500, which seems right based on what Halifax state, which makes it not an option entirely.

getmore4less

While you are 100% liable for the mortgage they can just say yes to the idea she will be paying.

Would not be happy with out a proper buyout.
This just leaves you in limbo at best and stitched up at worst. 


What are the rules on 106 and selling can it ever go to full value. 

frewbz

getmore4less said:

While you are 100% liable for the mortgage they can just say yes to the idea she will be paying.

Would not be happy with out a proper buyout.
This just leaves you in limbo at best and stitched up at worst. 


What are the rules on 106 and selling can it ever go to full value. 

When selling a section 106 property it must be sold at the set percentage discount of the open market value. So for example, it was originally 230k but has a 30% discount which made it 161k, so if it's now worth say 240k on the open market, it would be sold at 168k

getmore4less

One problem is you put yourself at a disadvantage by moving out. 

They can just sit there and do nothing. 

If you want it sold and take the hit on the ERC you may need to provide and incentive to the ex to sell, like move back in

getmore4less

Did you both qualify for the discount independently? 

Doozergirl

frewbz said:

hazyjo said:

Totally agree with diggingdude! Clean break. Sell. Take the financial hit now. I've been in that boat 3 times and I can't imagine anything worse than still having any sort of  interest in the property 5 years later or forced contact with an ex.

The things you listed your uncle did may make a house more saleable (if liked by others) but prob not more valuable.

Have to say, I stopped reading, as will others. Can you shorten it and take out all the emotive stuff? I know you want to get it off your chest, but please just include facts.

I can't just sell though can I, as she won't want to? So my options are either accept the buyout but still be tied to the mortgage for 5 years, or keep the house and at least maybe gain something from it. Also, I'm not sure how to edit threads.

Of course you can.  Or she can buy you out properly.  I wouldn't get bogged down in the emotion of what she has versus what you have - what you need is to be free, more so in the future than now, but it is essentially for your future so that you can buy again when you are ready and aren't legally tied to someone else,
bringing emotional baggage to your next relationship.

The mortgage penalty will have to be paid but it will be worth it in the long run.  

The present resolution is not satisfactory and the best thing for you is to not own any part of it.  

If your uncle is that great, he can help you next time.  You have not increased value with a fence, kitchen and a bathroom floor and none of it will be new in five years time. 

Move on, put your money into the  next house.  If you save at the same rate as your share of the mortgage and bills, you'll
be saving twice as much as you'd be paying for the mortgage.