Help with house selling conundrum

hereforhelp3

Thank you all for your advice. He is speaking to a mortgage advisor today and we are getting the house valued. If I sell to him at a lower price we will be seeing a solicitor and getting a clause saying ie. if he sells within 5 years I get back a split of any equity.

Bigphil1474

OP, I think you are getting your figures confused maybe? Is he buying for £200k but has £35k already in equity so can get a £165k mortgage, or are you selling for £165k and he can get a £130k mortgage? That's a big difference. It is a lot easier to have a ready made buyer in place. Will save you a couple of £k in EA fees etc. and it will also save in survey costs. However, it could mean you losing out. Generally, you would split it in that you get your deposit back (either flat amount or % of property), and then split the equity remaining between you. If you are happy to be a bit more generous then that's your choice. Their might be some legal complications for you in having an interest in a second property - check that out with your own solicitor. 

Albermarle

There could be room for negotiation- such as selling it to him at £180/£185K and that is the end if the story, saving on solicitors fees for arrangements such as below, estate agent fees etc and you can move on 100%.

 If I sell to him at a lower price we will be seeing a solicitor and getting a clause saying ie. if he sells within 5 years I get back a split of any equity.

Emmia

Albermarle said:

There could be room for negotiation- such as selling it to him at £180/£185K and that is the end if the story, saving on solicitors fees for arrangements such as below, estate agent fees etc and you can move on 100%.

 If I sell to him at a lower price we will be seeing a solicitor and getting a clause saying ie. if he sells within 5 years I get back a split of any equity.

OP it would be galling to you if he sold 5 years and 1 month later to a huge profit, which he then wouldn't need to share with you. That's why a clean break with you getting all your money out is better.

saajan_12

Angelcurls said:

My partner has offered to buy the house from me via getting a mortgage for the price we paid for it 8 years ago. I would get back the big deposit I paid plus extra for when I overpaid on the mortgage and he will then be able to afford a mortgage on his own and continue living in the house.

?

hereforhelp3 said:

Figures we are looking at:

house bought for £165k 8 years ago

if we sell house, clear mortgage then take back what we have both invested then my partner would get £35k back from a potential £200k sale price. He’s asking that I sell the house to him for £165k as that is the max mortgage he can get and then I clear the mortgage and buy somewhere on my own with remainder.

This is unclear, are you including interest in the 35k invested? As that's paid for the time you've both lived there. If you added in both your contributions incl interest plus the mortgage balance, you'd get to much more than the current value, so it doesnt' make sense to subtract from the 200k. 

Do you mean you both get back what you put in, as that would mean a 0% return when the house has actually appreciated 21%, even a savings accoutn would have given you something. 

Ultimately the price paid 8 years ago is irrelevant, money isn't worth the same now. However I would calculate the capital partner has paid and a reasonable gain on that. 

Some figures would help clarify:
* what was your deposit?
* what were the buying costs (eg solicitors, etc)?
* what is the mortgage balance now? 
* how much were your overpayments? 
* how did you split mortgage payments? 

sheramber

Does he not need a deposit? 

He is unlikely to get a 100% mortgage.

Or, are you selling the house to him for £200k with a gifted deposit of £35k?