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Original poster

To think that DH has been treated unfairly financially by his parents?

304 replies

TravellingToad · 29/05/2014 06:37

I'm struggling to get my head around something but have a feeling that it's unfair.

13 years ago DH and his sister bought a flat together. It was £120,000 and they didn't have any money. Their parents paid the deposit. DH and SIL paid the mortgage equally for 2 years. After 2 years SIL wanted to move out. DH wanted to stay but couldn't afford to buy out SIL.

The parents have SIL £60,000 on DHs behalf as her share of the flat. So that was 11 years ago. Yesterday DH sold the flat (for exact same as he paid which was £120,000)

His parents thinks he owes them £60,000 as they bought out his sister for him all those years ago. This seems unfair to me but I can't quite put my finger on why. I think it's because SIL didn't put any money into the purchase (neither of them did) but was gifted £60k after living there 2 years. DH serviced the mortgage for all that time, 13 years and has come away having to pay his parents £60k whereas SIL has that amount in her pocket. DH obviously has £60k in his pocket too from the other half of the flat but he paid into it for all those years so it's not really a bonus it's just what he put in. Sils £60k is pure profit

Can someone see clearly for me is this fair? Happy to pay it if it's fair. Their parents are extremely keen for both children to have been treated equally.

OP posts:
FuckYouChrisAndThatHorse · 29/05/2014 12:16

Are you certain that your pils didn't think SIL paid off the mortgage with the £60000? It's the only way their request makes any sense.

You cannot make an arrangement with a 3rd party and expect someone, with no knowledge of the amount or agreement that it was a loan, to pay back that amount.

I think SIL hasn't used the money as intended. It's the only explanation.

bedraggledmumoftwo · 29/05/2014 12:31

OP, here is a link to the land registry website landregistry

You can compare the movement in house prices between two dates, and look at property types to see flat movements. You would need to choose your specific location though, as I have just had a look and the value of a flat pretty much doubled between 2001 and 2014 in all of the regions when taking the averages.

StatisticallyChallenged · 29/05/2014 12:44

Yup, from what you have said dh doesn't owe 60k. At most and assuming it was a loan rather than a gift he owes them half the deposit.

They messed up and gave SIL far too much money. Your dh has probably paid about 95% of the mortgage himself, she should never have been given half of the value of the flat.

Itsfab · 29/05/2014 12:47

What does the SIL think of all this?

TheSultanofPing · 29/05/2014 12:51

Your Pil have acted as though they bought the flat outright for Your Dh and Sil.
They only paid the deposit, their involvement should have been minimal.

summertimeandthelivingiseasy · 29/05/2014 12:57

After 2 years, if house prices remained static, then the bank/building soc owned the flat, less PIL's £12000 deposit. Two years mortgage payments would add up to zilch in terms of paying off the mortgage.

If house prices had gone up, then she would have been owed her proportion of the increase.

Instead, she has the £60,000 Hmm

Original poster
TravellingToad · 29/05/2014 13:01

Yes it sucks that the value hasn't gone up. It was a new build flat, and not in England. It was on the market for 10 months at £130k. We dropped to £120k and got an offer. If they had bought an old victorian flat 2 mins down the road they'd probably be loaded now. Hindsight....

OP posts:
bedraggledmumoftwo · 29/05/2014 13:03

Just plugged some calculations into excel I should get out more but I miss playing with numbers while on mat leave Assuming a repayment mortgage on 108k at 6% (base rate was between 5.75% and 4% in 2001), over 25 years (standard term- presumes dh made overpayments later), balance would have been £104k two years later- so sisters share of equity to buy her out would have 8k PLUS half any increase in flat value(see previous link to land registry). This includes her 6k share of the deposit- they would only have paid off £2k each of the equity as mortgage repayments mostly pay off interest in the early years.

OP if you PM me your rough location I will do more detailed calcs.

ObvioulsyChangedNameForThis · 29/05/2014 13:11

SIL is laughing. She should have only got 6k. Or 12k at a push, so that she could have the same investment opportunity.

fifi669 · 29/05/2014 13:12

I agree with others, PIL need to chase SIL if they want the money back. DH has paid off the mortgage, it's his.

ObvioulsyChangedNameForThis · 29/05/2014 13:13

They effectively gave him 12k and his sister 60k.

ChickenFajitasAndNachos · 29/05/2014 13:15

I actually think for the PILs to be fair they would need to pay their son 60k minus the 12k deposit to match what their daughter was given assuming he took over the whole 112k mortgage. No way is it fair that he paid of the whole mortgage and is being asked to give half of the value of the flat away. Giving 60k back for help with a deposit isn't right.

ChickenFajitasAndNachos · 29/05/2014 13:17

Sorry I meant 108k mortgage.

ObvioulsyChangedNameForThis · 29/05/2014 13:18

Are their names on the deeds?

LittleMissGreen · 29/05/2014 13:22

In effect the PILs gave their son 12K deposit to buy a house, they gave their daughter 60K deposit to buy a house.
This is because the 60K wasn't used to 'buy out' the daughter from the original house but put into a new house.
Son needs to return 12K deposit.
Daughter should return 60K deposit when she sells her house.

bedraggledmumoftwo · 29/05/2014 13:22

House prices in the whole of the UK were booming between 2001-2003- I would expect the value to have risen maybe as much as £30 in that time, although it then depends why it is not worth more now- has the block been badly maintained or adversely affected by local development, or do you think it was overpriced off plan and therefore wouldn't have risen even then?

I would say her buy out should have been somewhere between £8k and £20k if the particular flat did temporarily rise in value back then

Bearbehind · 29/05/2014 13:33

OP, have you discussed this in detail with your PIL?

It sounds to me like there's a huge chunk of the story missing. They can't possibly not realise that they've given more to their daughter than their son based on the info you've given.

tumble PIL haven't given DH £60k at all- he paid off the mortgage which is why he now has the proceeds from the sale Hmm

Bearbehind · 29/05/2014 13:35

Ignore that last bit tumble I thought that was the last post but I'd gone back to page one for some reason Blush

lornemalvo · 29/05/2014 13:40

Your PIL did not pay for half of the flat. They gave your SIL money. That is between her and them. If they want money off your DP (which is bad form after 'giving' him the deposit) then he should give them their deposit back.
He has paid the mortgage by himself, capital and interest. It is very unfair. If he gives them 60,000 he will be down 48,000 (assuming they gave 12,000 as 10% of purchasing price) and his sister will be up 60,000. That's a difference of 108,000 between their 2 children. That is crazy.
Sorry if thread has moved on since OP. I only have a couple of minutes and can't read whole thread.

Bluegrass · 29/05/2014 13:54

I think I would say to them "when you very kindly offered this money was it your intention that [SIL] be given x times more than me? At the time I thought we were being given the same amount so I need to be clear if that wasn't what you intended for us".

If they throw up their hands in horror and say of course we wanted to treat you both the same, that's when you explain the figures to them. If the "yeah, we prefer her so gave her more", well, at least you know where you stand!

wafflyversatile · 29/05/2014 13:57

Are you sure you've not heard wrong and they've actually asked for £6k back as his half of the deposit? Confused

It's all nonsensical and overly complicated.

BlackDaisies · 29/05/2014 14:05

He just needs to make it very very clear to them that HE has paid 108 thousand pounds of the flat, they have paid 12 thousand when they paid the deposit. The other 60 thousand didn't go into his flat, but into his sister's and is nothing to do with him. It wasn't lent on his behalf because it wasn't what he owed his sister to buy her out. That was probably fairly little (2 thousand maybe?) because as someone else pointed out you're mainly paying off interest in the beginning. They gave her way too much, a mistake that had nothing to do with your Dh.

nyzz · 29/05/2014 14:24

Apologies as this is my first post but what I don't understand is if there was very little equity at the time that SIL moved out, why couldn't your DH buy her out? Based on the figures surely your DH only needed to pay her half of the deposit? Wouldn't it have made more sense at the time for your DH to get that from your PILs and pay off his sister?
Agree that something is missing, are you sure your DH has told you everything?

TheSultanofPing · 29/05/2014 14:39

nyzz it seems the Pil got confused somewhere along the line. They seemed to think that as the property was worth 120k, Sil was entitled to half that amount...even though the property was still mortgaged.

nyzz · 29/05/2014 14:47

Hmm, I see that the PIL may have got confused but I was wondering what DH was thinking he owed his sister and based on the figures we've been told why he wasn't in a position to buy her out (sounds like only a few thousand was owed)?
Also, as DH knew his parents had bought out his sister then surely he should have asked how much he "owed" his parents for that. It just sounds like DH hasn't passed on all the information to the OP.

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