Divorce & bank accounts

Flowerpower1966

I am in a difficult position regarding the sale of my house whilst I am going through a divorce. The situation is that I own 100% of a house in London (mortgage free) and my soon to be ex husband owns a house of his own elsewhere. I have to sell my house in London to pay him out. I have a buyer and we are going through the conveyancing aiming to complete by the end of February. The problem is where to bank the money from the house sale which will be a considerable amount. My ex is insisting that money is held in a joint signatory account where neither of us can access the funds without a joint instruction to the bank. 

I have called all the main banks to ask for such an account with zero success. Some banks said yes during one call and then the next call I would be told that they can't help. I even tried premium banks such as Coutts but they said no too.

I could leave it in the solicitors account but they do not pay me the interest but pocket it themselves. I find this disgraceful given the fees they charge.

My ex suggested an ESCROW account but this is for really rich people not us more mere mortals and will cost about £10k for the privilege.

I want to use a high interest account as it may be many months before we reach a financial settlement and it would be stupid just to let the money sit earning nothing. 

Can any of you lovely Forumites help with this?

Many thanks

Alexland

Normally you would ask your conveyancing solicitors to distribute the sale proceeds in accordance to the court approved consent order.

But it seems you are selling in advance of the distribution being approved so if you are still married and he has no specific interest in the property (other than a potential future distribution from it) then I don't see what's stopping you selling the property and keeping the money in your name for now other than it might make him upset. You should check this with your divorce lawyer.

It doesn't make any difference to him if the money is in the solicitor client account or a bank account it would still only be in your name if you were the sole owner. It's really no difference to him if the property is in your name or the money is in your name. The order would then need to be drafted to recognise the sale has already occurred. The only complication I can see if if he was still living in it so could somehow block the sale?

It's risky doing enabling transactions before the court approves the order for example you may find that you end up with a bigger % of the assets than was expected so they might not have been a need to sell the property.

Voyager2002

His demand makes no sense...

The property you are selling is yours, and so the proceeds once the sale completes will also be yours. You have a deal to "buy him out" whatever that means: obviously you are buying something from him and regard whatever he is selling as worth the agreed price. So it is reasonable for you to take care of your own money until you choose to spend it.

Incidentally, whenever I have had to leave money on deposit with solicitors they have paid me interest: not a lot, and they had to be reminded to do so, but they did pay. You do not need to use your divorce solicitor for the conveyancing work, and could choose a firm for this and ensure that they do pay interest on funds left on deposit.

Alexland

Voyager2002 said:

You have a deal to "buy him out" whatever that means: obviously you are buying something from him and regard whatever he is selling as worth the agreed price.

This looks like a "pay him out" from sale situation rather than buying out his interest and keeping the property.

My guess is he has "mentally banked" some of the value of the OP's property in advance of the court decision.

eskbanker

Alexland said:

I don't see what's stopping you selling the property and keeping the money in your name for now other than it might make him upset. You should check this with your divorce lawyer.

Yes, this is key - nobody paying a lawyer to represent them should have to resort to asking anonymous strangers on t'internet for guidance about dealing with a situation like this, so if the divorce lawyer isn't up to the job then it may be time to look elsewhere for a better one?

Alexland

eskbanker said:

Yes, this is key - nobody paying a lawyer to represent them should have to resort to asking anonymous strangers on t'internet for guidance about dealing with a situation like this, so if the divorce lawyer isn't up to the job then it may be time to look elsewhere for a better one?

One of the problems that can happen with divorce is that people go into mediation thinking it will avoid the cost of needing their own divorce lawyer (until later when the consent order needs drafting) but then you are left with nobody to help you get a realistic understanding of the range of potential outcomes and how to approach issues in the sessions to ensure you are focusing on the angles that are worth debating and not getting tied up on the inconsequential stuff or getting entrenched in non-issues in order.

It's important to get this help from your own divorce lawyer even at the mediation stage to ensure you get the right outcome. It's not simply the case that the assets needs dividing equally - there are a lot of issues at play so getting your own independent legal advice is essential.

Otherwise you could be unnecessarily conceding your positions and the mediator will just go along with it provided you both agree and they think it's likely the court would approve.

Section62

Flowerpower1966 said:

I am in a difficult position regarding the sale of my house whilst I am going through a divorce. The situation is that I own 100% of a house in London (mortgage free) and my soon to be ex husband owns a house of his own elsewhere. I have to sell my house in London to pay him out. I have a buyer and we are going through the conveyancing aiming to complete by the end of February. The problem is where to bank the money from the house sale which will be a considerable amount. My ex is insisting that money is held in a joint signatory account where neither of us can access the funds without a joint instruction to the bank. 
...

In case you've not run this by a divorce lawyer first... if he owns his own house and you own yours, then the court would take into account your need to house yourself in any consent order.  Even if you 'owe' him money the court may decide it is fair for him to wait until you are ready to move before he gets his money (particularly if you have children under 18 living with you).

Where will you live once the house is sold?  Have you allowed for the costs of selling/buying/moving within the overall settlement?

Understandable you may not want to share too much detail with us, but it sounds like he is being unreasonably pushy (e.g. being willing to waste £10k on an escrow account) which for me would be a red flag... maybe you need to take a step back and get legal advice/a second legal opinion?

Kim_13

Presumably OP’s London property is worth more than ex’s elsewhere (so non-London prices) and he is after half of the difference in a 50:50. This all seems really unnecessary in that you could both move into your respective houses and get on with your lives.

I also wouldn’t sell until the settlement was known (at present you seem to have the hassle of a sale while he is sitting pretty in his) and there was absolutely no other way of meeting it. Where will you be living once the house is sold? If you don’t make an onward purchase before April stamp duty will be higher, and if you have an onward purchase to make there would be less money in the solicitors account anyway. If the money was on joint signatures I could see an onward purchase turning into a nightmare.

Alexland

Kim_13 said:

Presumably OP’s London property is worth more than ex’s elsewhere (so non-London prices) and he is after half of the difference in a 50:50. This all seems really unnecessary in that you could both move into your respective houses and get on with your lives.

In my divorce the consent order divided assets around 55/45 in my favour and the court still approved. In mediation we explored factors such as the difference in premarital assets, the growth on that difference, how their pension would grow and have further contributions by the time they were my age, etc and eventually I was able to do a clean break buy-out rather than a pay-out. My mortgage did get bigger and I had to share a bit of a pension but I think we were both OK with the deal. There were points in the negotiation where it seemed the house would have to be sold with all the associated costs and further disruption to the kids living arrangements but we found a way to make it work.

IanManc

Flowerpower1966 said:

 My ex is insisting that money is held in a joint signatory account where neither of us can access the funds without a joint instruction to the bank. 

Only the court is in a position to "insist" on anything. Your husband can "insist" till he's blue in the face but you don't have to do what he tells you.

If the money is put in an account where no one can withdraw without both signatures then you are stopped from using your own money without his consent - which he can withold unreasonably if he is so inclined. Why give him that power over you if you don't have to?

Flowerpower1966

To all you very kind Forumites,

Thank you for all your replies - each one has been informative to my situation, full of wisdom and knowledge. Thanks.

I do have a solicitor instructed (at considerable cost) and she has not said to me that I can just ignore my ex and put the money in an account in my name only since it is still my asset. That makes me fume and I will make a point of saying so to her. 

It is the case  that my house is worth 4 x the value of his house but he has tried to push for 50/50. I bought the house before we were married and I can prove that I brought in 82% or the value of the marital pot at the Form E stage. I am therefore fighting tooth and nail for a 35/65 settlement to me. I still find this egregious but I'm told that's the most likely outcome at arbitration (if I get the right arbitrator...). BTW there are no children involved and we are 58 & 62 respectively. He has a slightly bigger pension pot. We have created nothing but misery for 12 years so I say we should keep what is our own and walk away. Apparently it doesn't work like that!

It does make me wonder if soon we will be able to just input our assets into an AI bot, press the button and hey presto, a settlement is sent back. It seems a better way to go than this achingly slow and expensive process! 

Thanks again Forumites!