A money one - who is being unreasonable?

You are given the option to ring fence money given by one party. If this is not done there is no 'his' deposit, it's theirs.

Even if he had done this, currently there is no equity for him to keep.

But legally Josh and Sophie are on an even keel. So it would be legally no more valid for her to sign over her 50% with no payment from him, then it would be for Josh to sign over the house to her entirely without payment. Does that make sense?

As hard as it is, and I'm sure for you who has a tie to josh this will be hard to accept, the fact that deposit was his inheritance has ceased to be of any relevance whatsoever.

They are two people who jointly own a home, that currently has little to no equity.

Presumably, you agree it would be a poor financial decision for Josh to hand over the house to Sophie with no money exchanging whatsoever, and let her keep the home forever, and enjoy any equity to come in the future.

Flip that around and you'll see it also makes zero sense for Sophie to do that for Josh. Speaking financially and legally, not morally, as again, that doesn't come into it.

And if there is no agreement, Sophie and Josh will have to stay on the mortgage. Tough that Sophie wants to move on. They both agreed to buy, both committed. That doesn't change because it was a poor investment.

Why should Sophie be able to walk away?

They both may need to rent it out until then market recovers.

Sophie likely won't agree to have her name taken off the mortgage and the house given straight to Josh without any money. That would be a foolish financial decision for her - should the house rise in equity once sold down the line she won't get any money if she hands over her right to 50% of the property.. If she stays on the house now and it sells down the line, she will. That's regardless of whether she continues to pay the mortgage.

Currently, they are equal and equally have nothing whatsoever.

If josh keeps the house and it rises in value then Sophie has lost future value for no pay off. That's why he won't be able to buy her out without exchanging money. Any solicitor would advise her against this.

Again, is that moral? Probably not.

Morality is completely irrelevant. People should be very careful about purchasing houses with people under joint conditions when they are fronting the cash. It is a HUGE tie and fair doesn't come into it. That money stopped being his the day he put it into a joint asset.

Josh doesn't have to like this. But that doesn't change a single thing.

It’s not really reasonable for him to walk away with his £30k untouched if the house has lost money. He unfortunately has to expect to lose some of that £30k as the house was a bad investment. However, I do think he should get more than Sophie from the proceeds of the sale, so she is liable for more of the outstanding mortgage. However, as he didn’t ringfence the deposit this relies (I assume) on her goodwill so he probably has to prepare himself for losing his £30k and walking away with nothing. He should get legal advice though, I don’t know if there is any recourse if he can prove he paid the deposit. But if that’s enough, why do people need to go to the effort to ring fence their deposits? So I suspect it isn’t enough. And legal advice/proceedings may well cost too much to be worth it anyway.

Basically it sounds like Josh is in a bit of a lose lose situation unless Sophie has a fit of conscience. Sounds unlikely as it sounds like she possibly left him for someone else.

Yes, clearly there’s no equity. But Sophie would walk away in the same position she started from (ie with nothing) and Josh would walk away with £30k less than he started with.
That’s not fair, so he should get some of his deposit back (albeit less than £30k as his investment decreased in value). If the property value had increased as is usually the case, Sophie would rightly have expected a share of the profit, so in the same vein she should pay Josh a share of his loss (the % of the decline in value).

If there's no equity, there's nothing to split. No chance of Sophie paying Josh a bean when she wants to buy a house with her new DP.

The best outcome for Josh would be to get Sophie's name off the mortgage, then he should live there himself and rent out however many spare bedrooms he has. In 5 years time he'll be laughing as tenants would have paid a decent chunk of his mortgage off.

There is no equity, the 30k is gone. He made a bad investment- there’s no protection for that and that’s the case with any investment, you can make money, you can also lose money.

Josh should get his full £30k back. If he had invested that money elsewhere it would have increased in value. They wouldn’t have been able to buy the house without it.

Actually yes I agree with this - this is the most fair. £26k deposit to Josh, split the rest

Sounds like Sophie needs to rethink her decision making skills. Jumping into buying with a new partner? Is she a bit thick?

And yes - re nature of the split - we don't have that info (unless it appears later in the thread) but in terms of what's right financially, I say Josh gets his deposit back, and everything else is split 50-50, assuming 50-50 payments. And that whatever else has happened to cause the split is separate to anything financial.

Josh should get back the £30k regardless since Sophie would not have been able to purchase the house at all and would have been renting without it. Even then, the £30k is generous to her as will not factor in inflation.

Then assuming sale price of £150k - half each, assuming both paying the same mortgage.

Astonished that Sophie would only be expecting to pay £15k and splitting the £30k deposit, given the circumstances.

The idea that Josh should suck it up and lose the money left to him by a relative is totally shocking imo.

Yes it's sad when a relationship ends and don't know the circumstances or other details

There is no legal route, the deposit wasn’t ring fenced and if it wasn’t in negative equity arguably Kate could argue for a portion to pay her out
And however badly she has treated him the fact the deposit has gone and they are moving is the market

removing her from the mortgage if he can afford it is the way forward any gains from there would be his and his alone

I mean, morally he should get more of the money (or less of the debt?) but surely this is a moot point until he gets legal advice. He is well within his rights to ask for that but surely it depends on the bottom line of the law.

To add, ring fencing it would just have meant that he would get his £30k back first of any equity that was there to be split, so here where there is no equity he would still have got £0 anyway.

Ring fencing it doesn’t protect you from a bad investment which this was, the money is gone.

If Sophie has the cash then morally yes she should offer to repay 50% of the deposit.

On the flip side Josh agreed to pay the deposit at the time and if there was no agreed repayment discussed then maybe it should just be let go and put down to experience.

I agree with this poster. It’s hard for him to swallow, but that was the risk. To avoid throwing more money away legally, I’d suggest they get her removed from the mortgage if they can and he keeps it on his own. Clean break. No money changing hands.

He then has the chance over time to get back in positive equity and eventually see his investment pay off.

OP Josh can simply take over the mortgage in his sole name- he just needs to contact an adviser and go through the process of legally “buying” her out. Unless he can’t get a mortgage in his sole name.

There is no legal route for him to get his money back here. He didn’t legally protect the deposit which means it stopped being “his” that day and it’s gone now anyway so even if he ring-fenced it, £0 is £0.

I don’t think there’s any point going down a legal route as he wouldn’t be entitled to anything and he’d just waste money. Moral entitlement only here I’m afraid.

There probably won’t be anything to split once they have paid legal fee’s estate agents etc the house has a mortgage of £180,000 that they have only been paying 3 years they will have hardly paid anything off it think people are assuming the house is paid for and they will be splitting £180,000 when in reality it’s probably going to be around ten grand so I’d say personal who put deposit down should get anything that’s left after the sale

Morally no he shouldn’t just lose his inheritance, Sophie should pay him 15k. Legally, Sophie hasn’t got a leg to stand on. Josh should have insisted on a tenants in common mortgage to ring fence the deposit. They could have had a different split than 50-50 to compensate for this. My ex and I did that, as he also paid 30k deposit, and I didn’t pay any. When we split I could have claimed 40% of the equity, and ex DP paid 60k off the mortgage that he saved whilst I paid for everything for the kids and the majority of the food shop. But I didn’t claim for any of the deposit or 60k.

If Josh wants to stay in the house surely the easiest thing to do is for Sophie to leave with nothing- no equity but also no debt. Best for both I think as Josh also avoids z big expensive upheaval.

Josh is being unreasonable. They legally each own 50% of the house and the proceeds (or losses) are split equally. Josh is deluding himself if he thinks Sophie is going to hand over thousands of pounds at this stage. Lesson learned, move on.

If affordable, Josh might as well stay in the house (removing Sophie’s name) rather than incur estate agent fees etc. Perhaps he could rent out a spare room to help with costs.