Help with shared ownership spilt

bodiddly80

The house was purchased in 2004 for 182k

Deposits of 65k and 4k left the mortgage (interest only) at 113k.

The tenants in common agreement suggest Party A, who put in 65k, was to paid 31% of the mortgage (again interest only)  Party B who paid 4k was to pay 69% of the interest only mortgage.

This gave Party A 55% of the house and Party B 45%

The contracted stated that any improvements to the house would be paid following the shares. - 

19 years later Party A has not paid any of the 55% contracted to and Party B has paid between 40-60k worth of home improvements. Party A is agreeing that Party B has spent 40k on improvements but still wanting 55% share, surly the percentage changes due to the invest ?

Party A never lived at the house Party B has lived there for 19 years and wants to buy Party A out.

Based on a compromise agreement Party B is happy to settle for 40k home improvements. This would make total investment 222 now. Making Party A 45% share owner and Party B 55%

Then the would agree a sale price of 360k.  Party A was get 45% of 360 - their 31% of the mortgage to be repaid and Party B would get 55% - their 69% of the mortgage to be repaid.

Is this correct ?

The only other formula I can conclude is Party A has 29% of the equity (65 of 222) and Party B has 20% of the equity) the remaining 51% is spilt 31/69 as per mortgage spilt. This makes Party A own 44.81% and Party B 55.19% of the equity but only once the mortgage was paid so 360-113 = 247 spilt 45/55.

Am I missing something ? 

The_Unready

No advice, I'm afraid, but to paraphrase that old joke, "I wouldn't have started from here"! 😃

london21

This is complicated and messy. 

bodiddly80

london21 said:

This is complicated and messy. 

I agree - but who is in the right here ? If the contract states Party A has to pay 55% if the improvements and hasn't paid any and Party B has paid 100% of the improvements - surly that needs to reflected in the ownership share. Otherwise party B hands over 55% of the house and gets nothing for their extra investment. 

SusieT

How about the original split, but party A has to pay 55% of the improvement cost (so whatever the buyout figure is you deduct £20-£30k from whatever they would have got. Clean, simple and easy to work out.

_Penny_Dreadful

Duplicate thread: https://forums.moneysavingexpert.com/discussion/6423585/breaking-common-in-tenants-agreement-deed-of-trust

bodiddly80

_Penny_Dreadful said:

Duplicate thread: https://forums.moneysavingexpert.com/discussion/6423585/breaking-common-in-tenants-agreement-deed-of-trust

Slightly different question. One is asking if the deed of trust is broken

bodiddly80

SusieT said:

How about the original split, but party A has to pay 55% of the improvement cost (so whatever the buyout figure is you deduct £20-£30k from whatever they would have got. Clean, simple and easy to work out

Yes that could work ! But its a lot less than they want.

_Penny_Dreadful

bodiddly80 said:

_Penny_Dreadful said:

Duplicate thread: https://forums.moneysavingexpert.com/discussion/6423585/breaking-common-in-tenants-agreement-deed-of-trust

Slightly different question. One is asking if the deed of trust is broken

Should have been one thread. 

bodiddly80

_Penny_Dreadful said:

bodiddly80 said:

_Penny_Dreadful said:

Duplicate thread: https://forums.moneysavingexpert.com/discussion/6423585/breaking-common-in-tenants-agreement-deed-of-trust

Slightly different question. One is asking if the deed of trust is broken

Should have been one thread. 

I'm new to this !

bodiddly80

person A want 

sale of house, minus mortgage, minus deposits, minus 40k

surplus (247) divided 55/44

and then deposits returned.

That would actually give person A 66% of the house equity ? Surly that cant be correct ? regardless if the 40k is improvement or upkeep