Unmarried couple splitting up

Carpetman

My son and his girlfriend bought a house just over two years ago with a joint mortgage via Halifax Bank.  Unfortunately, she is now his ex-girlfriend as she walked out nearly 6 months ago.  They agreed that he would keep the house as long as he paid her £15k, however, Halifax offered him £21k less than the original mortgage meaning in total he needs to find £36k plus his expenses.  He's kept the mortgage up and paid all the bills since she left the house.  His solicitor has told him that she needs to get legal advice because both of them are registered on the deeds, obviously, he wants her off them, and she is now demanding that he pays all her costs which she is quoting at over £1k to get out of the situation.  He can hardly afford his own costs let alone pay hers.
Currently, they are at loggerheads - does anyone have any ideas on how this stalemate can be broken at least cost?

[Deleted User]

Whats the property worth?  Best case scenario at the moment he is only going to be able to finance 85% of it so if 85% of the proeprty value isnt enough to cover the mortgage and the money for her to leave then he will need to find it another way.   Either by selling or asking for family help

There is 1 lender going to 90% on a remortgage but the rates arent great.    

This is before any affordability calculations are brought in to play. 

Meh123

Nightmare. To start with do they actually know how much equity is in the property? That would be a good place to start, is the 15k a reasonable payout price.
He doesn’t have to pay her costs though, costs are to be expected when attempting to separate assets. It’s fine to break up, if even fine to want out of the mortgage but you can’t expect to have no financial inconvenience from it 🤷🏼‍♀️

At the moment it seems she wants out of the mortgage, a lump sum and no legal fees....she might have to budge a bit to make it viable, because if she doesn’t, they'll have to sell the house and if there isn’t a spare 30k rattling around in equity she’ll get less anyway....and half the solicitor costs to sell it 😅

getmore4less

Lack of detail does not help decide what would be reasonable.

MWT

Can't really comment, £15k and her costs paid could be a fantastic deal for your son if she originally put down a £20k deposit and has paid half the mortgage costs to date with positive equity growth in the house, or it could be the worst deal ever if he provided the entire deposit at the start and she hasn't contributed to the mortgage and the house has lost value...

CSL0183

As above, valuation is required to determine what equity there is, then an agreement from there. 

If he can’t remortgage the home to release the funds to buy her out due to LTV being too high then it will need to be a personal loan to buy her out. The solicitors bill should be split 50/50, the both of them need exactly the same outcome. (Remove his ex from the deeds). With her remaining on the deeds, she wouldn’t be able to buy another home due to the 2nd home tax. 

The starting point though is the valuation minus the mortgage balance, getting the equity and then deciding on a split of it. 

Did she put in a deposit? Did she pay 50/50? Your son has paid the last 6 months without her support so why should she get 50/50 on the split if he is currently paying down the mortgage? The longer it drags on, the more equity he is building and the more equity share she will get (if they keep with the 50/50 thing) 

Yes, these situations are a nightmare, been through exactly the same with an ex. 

I don’t really understand what you mean here though..

“Halifax offered him £21k less than the original mortgage meaning in total he needs to find £36k plus his expenses”

Is he trying to remortgage? He won’t need to find £21k if he just keeps paying his current deals monthly payments. If there is £30k equity in the house after valuation and he needs to find £15k then a personal loan would be the better bet, if money is right, choose the longest possible term. Out of that £15K though, if solicitors bills are £1,000, she walks away with £14,500, not £15k. (£500 each) - Removing names from deeds only takes one solicitor and it’s not costly at all to do. He should phone up his lender and they will probably assign one of their own to do the deed work for him. 

And yes, if she is being difficult then the next option is to sell the home and go 50/50 after all costs. Very likely that after all costs there wouldn’t be £30k leftover to split. Your son then starts again in another home. Out of her imaginary £15k she might only end up with £5k of it after house has been sold, so that’s where to start with the negotiation.  Force her hand, she either plays nicely and acts reasonably otherwise the home is going on the market and she’ll get a lot less than she thinks.  

[Deleted User]

CSL0183 said:

 

I don’t really understand what you mean here though..

“Halifax offered him £21k less than the original mortgage meaning in total he needs to find £36k plus his expenses”

Is he trying to remortgage? He won’t need to find £21k if he just keeps paying his current deals monthly payments. If there is £30k equity in the house after valuation and he needs to find £15k then a personal loan would be the better bet, if money is right, choose the longest possible term. Out of that £15K though, if solicitors bills are £1,000, she walks away with £14,500, not £15k. (£500 each) - Removing names from deeds only takes one solicitor and it’s not costly at all to do. He should phone up his lender and they will probably assign one of their own to do the deed work for him. 

And yes, if she is being difficult then the next option is to sell the home and go 50/50 after all costs. Very likely that after all costs there wouldn’t be £30k leftover to split. Your son then starts again in another home. Out of her imaginary £15k she might only end up with £5k of it after house has been sold, so that’s where to start with the negotiation.  Force her hand, she either plays nicely and acts reasonably otherwise the home is going on the market and she’ll get a lot less than she thinks.  

To remove her from the mortgage he will need to pass halifax affordability checks on his own.  Presumably his max loan is £21k lower than the current mortgage so he needs to reduce the balance by £21k to get permission from the bank to remove her.

This 21k, plus the 15k to walk away is the 36k he currently needs

CSL0183

Deleted_User said:

CSL0183 said:

 

I don’t really understand what you mean here though..

“Halifax offered him £21k less than the original mortgage meaning in total he needs to find £36k plus his expenses”

Is he trying to remortgage? He won’t need to find £21k if he just keeps paying his current deals monthly payments. If there is £30k equity in the house after valuation and he needs to find £15k then a personal loan would be the better bet, if money is right, choose the longest possible term. Out of that £15K though, if solicitors bills are £1,000, she walks away with £14,500, not £15k. (£500 each) - Removing names from deeds only takes one solicitor and it’s not costly at all to do. He should phone up his lender and they will probably assign one of their own to do the deed work for him. 

And yes, if she is being difficult then the next option is to sell the home and go 50/50 after all costs. Very likely that after all costs there wouldn’t be £30k leftover to split. Your son then starts again in another home. Out of her imaginary £15k she might only end up with £5k of it after house has been sold, so that’s where to start with the negotiation.  Force her hand, she either plays nicely and acts reasonably otherwise the home is going on the market and she’ll get a lot less than she thinks.  

To remove her from the mortgage he will need to pass halifax affordability checks on his own.  Presumably his max loan is £21k lower than the current mortgage so he needs to reduce the balance by £21k to get permission from the bank to remove her.

This 21k, plus the 15k to walk away is the 36k he currently needs

Thanks, yes makes sense. Hadn’t thought about that. 

Carpetman

Ok, the house has been valued at £175,000 and Halifax will only give him a £103,000 mortgage meaning he will have to pay them £21,000 to cover the original £124,000 mortgage.  
She wants a clear £15,000 to remove from the original mortgage. 

Thrugelmir

Unless someone is willing to step in and gift the money required. Selling up is the only way forward.  Your son will then need to buy someone cheaper that's affordable. There's no magical solutions to this eternal issue that continually crops up when relationhips breakdown. 

getmore4less

What is the basis of the £15k demand?