Calculating how to buy partner out when different contributions were made

getmore4less

zedox1 said:

for the 1st 4 years mortgage payments were 50/50. Since the split I've agreed to continue paying the mortgage by myself.
How would I reflect this in the calculations?

Depends...
Have they moved out and pay nothing?
Do they still live there mortgage/rent/bills free?
Other?....

You will need to agree a valuation for the time you took over mortgage payments.

zedox1

getmore4less said:

zedox1 said:

for the 1st 4 years mortgage payments were 50/50. Since the split I've agreed to continue paying the mortgage by myself.
How would I reflect this in the calculations?

Depends...
Have they moved out and pay nothing?
Do they still live there mortgage/rent/bills free?
Other?....

You will need to agree a valuation for the time you took over mortgage payments.

They've moved out and we agreed I would pay 100% of all bills and mortgage payments which began this month.
We did agree on a valuation at the time she moved out. This was based on an average of 3 local estate agent valuations. 

I was just thinking, my mortgage lender said they would need to value the house as part of the transfer of equity or remortgage. So if they decided it was worth a different number then wouldn't we need to recalculate everything?

Or is it best just to stick to figures noted down at the point they moved out?

getmore4less

you have the % they own at the point they moved on and you take over everything.

its what you do with that % moving forward.

You can have it fixed as the price at the time.

Then how do you account for the delay of payment.

Some think until actually paid off you should be paying nominal rent for that share.

One way to account for that is have them continue to get the appreciation of just that share to the date of payout.
In effect I will let you live in my share for free but I get any uplift/drop for that share.

There are other options like fixed appreciation based on something like mortgage rate or RPI or.......

quick re-read   you have £425  agreed and ~£39k-~£45k  to buy out so roughly 10%  

If you get the job done quickly then you should be in a rough ball park anyway not worth quibbling over a few £100 on £400k+ transactions, could easy be out by  +- 5%(£40k) even +-10%(£80k)  

Mortgage valuation could be lower as EA do tend to add a bit.

While it is amicable and you are staying which is the easy less hassle option I would keep the deal on the sweet side subject to affordability and lender agreeing

Thrugelmir

zedox1 said:

for the 1st 4 years mortgage payments were 50/50. Since the split I've agreed to continue paying the mortgage by myself.
How would I reflect this in the calculations?

Your ex is still incurring housing costs presumably. Are you factoring that in? 

getmore4less

Thrugelmir said:

zedox1 said:

for the 1st 4 years mortgage payments were 50/50. Since the split I've agreed to continue paying the mortgage by myself.
How would I reflect this in the calculations?

Your ex is still incurring housing costs presumably. Are you factoring that in? 

No need, this is a 2 people selling a house to one person(just happens one is the same).

You would not expect a buyer of your property to take account of you ongoing housing costs.

Same applies here as all the costs have transferred.

The issue here will be the buyer has not paid the seller all their money and how you account for that delay. 

Thrugelmir

getmore4less said:

Thrugelmir said:

zedox1 said:

for the 1st 4 years mortgage payments were 50/50. Since the split I've agreed to continue paying the mortgage by myself.
How would I reflect this in the calculations?

Your ex is still incurring housing costs presumably. Are you factoring that in? 

No need, this is a 2 people selling a house to one person(just happens one is the same).

One party is intending to claim a greater share as is still paying the mortgage though. The other party cannot contribute equally as now may have an additional financial burden. 

Nothing like money to make people enemies. 

getmore4less

Thrugelmir said:

getmore4less said:

Thrugelmir said:

zedox1 said:

for the 1st 4 years mortgage payments were 50/50. Since the split I've agreed to continue paying the mortgage by myself.
How would I reflect this in the calculations?

Your ex is still incurring housing costs presumably. Are you factoring that in? 

No need, this is a 2 people selling a house to one person(just happens one is the same).

One party is intending to claim a greater share as is still paying the mortgage though. The other party cannot contribute equally as now may have an additional financial burden. 

Nothing like money to make people enemies. 

The proposal is they buy out the beneficial interest at the value when the mortgage payments transferred.

The share is determined at that point in time.

The issue is how you adjust for a delay of that payment.