Divorce- Should we sell our house or sell my share for much less than its value?

lisyloo

AMartMan said:

@lisyloo

I think she's had it for about 8 years now, full time. 

So it's still a fair amount more that I'd get than 10k. Understood.

I do freelance work as well but it's not consistent whilst the stable job pays bills. 

Everything comes down to negotiation (unless it's worth going to court).
I think her pension is worth several times the equity you mention, so personally I would try to stall things until the pension figure comes out saying something along the lines of not wanting to muddy the waters.

The problem with the pension is that she can't touch it so you could end up with an entitlement to her pension which means you get that when she chooses to take it or reaches a certain age.
Lots of people prefer a clean break but it doesn't sound like she has other assets to give you.

You can choose to walk away with nothing if you choose (and some people do) but would you want to turn down a share of her pension if it's several times the value of the house equity?

AMartMan

@lisyloo

I've never thought about that. Worth bearing in mind. Thanks for making me aware! 

Rhubarbium

Depending on the value of her pension you could maybe get a pension sharing order where you get sufficient from that to cover your share of the house equity. Could be a win/win as she’d get to keep the house and you’d get all your equity (although it’d be invested in your pension)

Gavin83

I agree that her pension is likely to be a lot higher in value than the equity in the house. If you left with nothing but £10k you’d be cheating yourself. Wait for her pension statement and decide what you wish to do but you could well be walking away with more than the total equity in the property.

Unfortunately she’s likely to feel extremely hard done by in this divorce so I expect she’ll be difficult but the law is the law.

saajan_12

AMartMan said:

@lisyloo


So how much do transaction fees come to on average when selling a home? Even if I got 20k in a sale, what might I end up with after those come out of it? If it's not far off the 10k I'm being offered for a buyout then I guess we should push for that. 

Costs - say 2k estate agent, 1k mortgage fees/survey/searches that the new lender will want, so 18.5k share after costs if you actually sold up. 

However the flip side is if she ends up in a purchased house she saves the costs that you'll have to spend get back to the same position as before. Not that you should begrudge her the convenience, but just that could be factored into the split. So if your mortgage / solicitor / moving costs are say 4k higher than her remortgaging, then you get that much more, ie 22k for you, 18k for her would be more fair of she stays out. 

Malthusian

lisyloo said:

The problem with the pension is that she can't touch it so you could end up with an entitlement to her pension which means you get that when she chooses to take it or reaches a certain age.

That's called "earmarking" but has been a very old-fashioned and undesirable way to split a pension for many years, for exactly the reason you mentioned.

A Pension Sharing Order should be a possibility, which would allow the OP to receive a cash sum which they could transfer to a personal pension. The defined benefit pension would be reduced in proportion to the CETV taken out. (In theory the wife's pension scheme could allow the OP to join the scheme and retain a defined benefit pension, but I've yet to hear of a scheme allowing that in practice.)

The main disadvantage of splitting a pension scheme in this way is that defined benefit pensions are usually more valuable than the CETVs, at least on the objective basis of how much pension fund you would need to buy the equivalent pension on the annuity market. So the spouse taking the PSO can get less than the other spouse gives up. It is often desirable for the spouse with the large defined benefit pension to let the other spouse take away more of the other assets so that they can hang on to their gold-plated pension - if there are enough.

If the pension being split is defined contribution / money purchase and has no safeguarded benefits, this isn't an issue (as every £1 one spouse gives up from their pot means £1 in PSO for the other).

AMartMan

@Gavin83
She is already being difficult and I haven’t even sprung the pension aspect on her yet, will tread carefully but at least you’ve all given me useful advice. At the end of the day I’m giving up more than she is sacrificing so maybe I should chase this up to even the playing field. 

Also her CETV won’t be available until maybe June as her HR dep won’t divulge for three months, which is a pain really. Will find out sooner than later fingers crossed!

Thanks for the insight everyone, been really helpful and have learned a few things!

DE_612183

ok, but even if you mention the CETV to her - at least she knows you know what you are talking about...

lisyloo

AMartMan said:

@Gavin83
She is already being difficult and I haven’t even sprung the pension aspect on her yet, will tread carefully but at least you’ve all given me useful advice. At the end of the day I’m giving up more than she is sacrificing so maybe I should chase this up to even the playing field. 

Also her CETV won’t be available until maybe June as her HR dep won’t divulge for three months, which is a pain really. Will find out sooner than later fingers crossed!

Thanks for the insight everyone, been really helpful and have learned a few things!

I think you should hold fire on the property because it's part of the negotiation.
As already observed she is not going to be happy - but you have entitlements and the fact that you're a man doesn't negate that in anyway (it's usually the other way round).
The way it normally goes is that the property would be used in the negotiations i.e. you give her a bit of what she wants to get what your want (or are entitled to).
You might need to get a solicitor as your share may be worth fighting over but the kind of language used is "No court would deem this a fair offer" i.e. a shot across the bows that she won't get away with taking you for a ride.
There is always a certain amount of back and forth which is expensive.
If you can come to an agreement outside of solicitors then that is good, but I think it might be unlikely and if she's already being difficult then she may need the shock of the solicitors letter indicating that you are expecting a reasonable offer considering your entitlement.

It's not nice but think of it this way - she's trying to take you for a ride here.
A female solicitor might be best (women see through other women).
Do what you want with the suggestions.
Unfortunately there isn't a nice way to handle the shock coming to her if she has other expectations but that's not your prime concern anymore.

DE_612183

One other point I'd here is that although you are using an organisation called "amicable", at the end of the day they are a business and one that works on the basis of fixed fees.

So it is in their interest that both parties agree so as little of their time is taken up - that being the case if one party is seen as more "difficult" or "vocal", then they may try and push the other party into an agreement that they are not wholly happy with ( which may have been what's happened here ).

But please don't be afraid to stand up now - it's better to get it out in the open than allow any resentment to fester inside of you - that will only make your health worse in the future.