Buying Someone Out??????

nickpike

I've recently split with my fiancee and we need to sort the house. After unsuccesfully trying to sell it (3 viewings in 8 weeks!!) I've been made an offer by my parents to buy my ex out of the mortgage and then we'll rent the property. My trouble is; how much is it worth and how much should she get? We were told by the estate agent that we could get £115,000 for it. We bought it for £94,000. We have £97,500 (inclusive of interest) outstanding on a 5 year fixed, of which we are 2 years into. We would be charged £3,500 exit penalty if we did sell. Therefore, best case scenario we would have £14,000 left over to split 50/50.

115000 (Ideal sale value)-101000 (repayable to Northern Rock inclusive of penalty) = 14,000 left over. £7k for me, £7 for her.

However, with it not attracting much interest should this figure be lower? Plus how do I get an actual valuation. I've noticed in the small print of the estate agents that the value they have given is not a legal value, it's just used as a guide for the property market.

Any help/advice would be greatfully recieved.

Hope it all makes sense
:huh:

Nick

chuckles1066

nickpike wrote: »

I've recently split with my fiancee and we need to sort the house. After unsuccesfully trying to sell it (3 viewings in 8 weeks!!) I've been made an offer by my parents to buy my ex out of the mortgage and then we'll rent the property. My trouble is; how much is it worth and how much should she get? We were told by the estate agent that we could get £115,000 for it. We bought it for £94,000. We have £97,500 (inclusive of interest) outstanding on a 5 year fixed, of which we are 2 years into. We would be charged £3,500 exit penalty if we did sell. Therefore, best case scenario we would have £14,000 left over to split 50/50.

115000 (Ideal sale value)-101000 (repayable to Northern Rock inclusive of penalty) = 14,000 left over. £7k for me, £7 for her.

However, with it not attracting much interest should this figure be lower? Plus how do I get an actual valuation. I've noticed in the small print of the estate agents that the value they have given is not a legal value, it's just used as a guide for the property market.

Any help/advice would be greatfully recieved.

Hope it all makes sense
:huh:

Nick

What's it on the market for?

If it's on for £115k and it hasn't attracted a nibble in 8 weeks then your estate agent has exaggerated the value.

An actual valuation you'll have to pay for via a survey from a proper surveyor......but even he will take the market value as per what's been sold recently in that area and then work downwards based on anything that needs fixing.

nickpike

It's on for offers over £105,000. And as it's in Scotland it works up the way. So we were told to expect £115,000. Generally 10% over. They've put down for £115,000 if it were to be fixed price. I have asked if it's been overpriced and they are convinced not. However, I'm not so sure! Thanks for the quick post.

chuckles1066

nickpike wrote: »

It's on for offers over £105,000. And as it's in Scotland it works up the way. So we were told to expect £115,000. Generally 10% over. They've put down for £115,000 if it were to be fixed price. I have asked if it's been overpriced and they are convinced not. However, I'm not so sure! Thanks for the quick post.

Ok, at OIEO £105k I'd have expected some interest; have you tried other ways of selling it?

Maybe your parents should offer £110k which gives your ex £4.5k and then you can draw a line under the relationship.

It might be worth paying a couple of hundred quid for a survey and valuation though, if it's valued at, say, £108k that's £2k you've saved your parents and £1k you've saved paying your ex :rolleyes:

CLAPTON

its a falling market ... if you're on good terms with her discuss a price of 105k for a quick resolution... after all you are taking the risk of further collapse

otherwise expect negative equity within 6 months

lightspeed

Hi - the following is based on the assumption that your parents want to give you the money to by her half of the property or buy it themselves meaning that you and your parents will be on the mortgage.

I was in this exact situation a little over 12 months ago and have JUST bought my ex out of a jointly owned property.

Firstly, get 3 valuations from different EA's and find the average valuation (in your eyes you would obviously prefer these valuations to be on the low side).

secondly, enquire immediatly about a transfer of equity from your mortgage company. Everything hinges on whether they will allow you or your parents to buy out your ex.

Thirdly, decide whether you can deal with this whole situation amicably. If not get a solicitor to instruct you on how to protect yourself. If you can, make her an offer slightly below the average valuation minus fees (EA's, penalties etc...).

If you have any questions regarding my own experience, please dont hesitate to ask.