Financial & Legal Minefield - can anyone advise?

[NeverGuessWho]

Posting here for traffic. Will try to be brief. I am separating from DH & live in England.
There is a substantial amount of property within the marriage, that is tied up in DH’s company, but I am clueless how much equity there is, as DH refuses to provide current mortgage statements for any of the properties (even our home.) All the properties are in his name only, some purchased prior to marriage (while we were living together with our DCs,) some purchased during the marriage. He just always refused to put my name on anything.
My DF has offered to buy a property for me and DCs, who will live with me for 50% of the time. It will be in his name, until I get a financial settlement, which will take forever, as DH will drag his feet. Initially, the verbal agreement between DF and me was that I would pay the monthly loan/mortgage repayment, & this would be deducted from what I owe my DF. Solicitors fees, stamp duty etc, incurred will, of course, be added to what I owe my DF, to be paid off in the future, on receipt of a divorce settlement. Today, DF has told me he is going to increase the rent I will have to pay, none of which will go to pay off the sum I owe. He said that he will have to pay tax on the rent I pay him, and that buying the property is wiping him out.

Am I right in thinking that he will only have to pay tax because he now is going to make a profit, so it will be an income; whereas, if he had stuck to the original verbal agreement, and was charging me the same amount as the repayment, he wouldn’t be charged tax?

Also, does anyone know of the legal/tax implications of me getting a financial settlement, and then paying my father back what I owe him? Will I pay tax on the lump sum that I receive - I am clueless about this.

I am seriously considering just staying separated, and staving off a divorce indefinitely, so that DH doesn’t have to sell the house, IF we can agree that he gives me the money to pay my dad back. This amount would then be deducted from any future settlement if/when we divorce in the future. However, my head is telling me that this is insanely risky & foolish.

I know I need to see a solicitor, but they don’t come cheap. I’m on a very low wage and I thought if I could gain some wisdom here prior to making an appointment, it might save up some time and money.

TIA

Only on MN would someone think that the OP's father is 'pissing her about with property' when he's offered to make a massive financial gesture

Your father would be liable for income tax on the rent you paid, regardless of whether the house was mortgaged or not so I can see his point tbh. There are some allowable expenses but I agree that you need to take control of your own financial situation and not rely on your father.

It's a difficult situation and as PP have said, I really would take proper legal advice. Also, don't 'stave off' divorce to keep the property, you can't afford to run it by the sound of it so face that now instead of running up debts.

Re your husband’s property (which is also yours). I would look to putting charges in all of them whilst you thrash out your financial settlement. It will stop him off loading them or taking out additional loans against them.

@RoomR0613 I don’t disagree that my interpretation could be wrong! In fact, that why my second post did say that maybe he just didn’t realise the implications

Why did my gut feeling jump the other way? I don’t know, but I looking back I think the key thing was the phrasing of OP being “told” she will have to pay more. That’s quite a different feel to “now dad has looked into it, he’s found out...”. That, coupled with OP asking basic questions (as in easily googled) on here about tax on rental income. She shouldn’t need to ask that if her father is discussing this with her - not just telling her. That gives me the feeling that just as in her marriage, she’s shut out of the financial detail.

OP is very sensible in seeking info here - but she shouldn’t have to, this should be an conversation with her father.

Finally, where is his financial support for her getting divorced?

Her father may be lovely.
Not all are.

Who’s to say that she won’t be posting here in 3 years time saying she’s ready to pay off what age owes, divorce has been settled. But now dad has moved the goalposts and he doesn’t want the £50K deposit he put down. No - he wants £75K because of increase in value. I bet OP can’t tell us what the exact agreement is. I have seen plenty of people post on MN when they’ve been shafted over property by their own parents.

I’m cynical, and I’m absolutely not saying that I’m right. But my gut reaction was “out of the frying pan into the fire”.

@ChicCroissant you can disagree with my reaction, but I don’t think the was necessary. Have you never seen the threads on here from people who have thought they were paying off ‘their’ house, through rent, to be transferred to them and then the goalposts moved?

I’ve answered @RoomR0613 above about why that was my gut reaction. I certainly could be wrong, but I don’t think it warrants a

At the very least, OP’s father is not explaining the detail to her properly - as she had to ask here about what tax is due on rental income. Her father has that information, or he wouldn’t have told her that the rent would be higher.
So even if he’s not pissing her about, either he isn’t including her fully in the detail - or something’s off in the dynamic with her father that she doesn’t ask him instead of asking on here.

Stay where you are and sort it out from there. Don’t take your fathers offer, he has already changed the terms once, and will do s9 again to suit him

What and sort out a settlement, however long it takes. Get a good solicitor

Yes a solicitor is vital eg I think the charge over the home cannot be applied to other properties. Although if there is a risk properties will be lost then it is possible to get freezing orders over other assets (but that becomes much more expensive than the simple right you can register over the family home I linked to above)

Get a solicitor. I am a family law solicitor, though you couldn't possibly tell whether or not I'm telling the truth.

It might harm your case if your father provides you with a home - any needs based argument will be less effective.

Listen to Xenia at 9.34 and above.
She is a lawyer and has coal face experience of handling a divorce settlement.

Start from the premise that
A) if your H us hiding money and assets it is an amount worth fighting for
B) your H is financially abusive (the hiding, the potential that the 50% arrangement is to undermine your claim to stay in the marital home and / or get any child maintenance)
C. Your H has done his research (see above) with access to accountants etc. You cannot possibly expect to stand up to this by posting in AIBU ‘for traffic’. Some traffic might help, some might run you over. You need qualified advice.

Ask your dad to loan you the money for proper legal advice...

Thanks to everyone who has replied so far.

@Xenia, thanks for all your advice, I really appreciate it. But 100% DH won’t sell the property, it’s the last thing on Earth he wants to do, & I can’t and don’t want to stay here. It’s grade 2 listed with acres of land that I can’t manage, leaks everywhere & rotting sash windows that I can’t afford to replace. It costs s fortune to heat. Things that have happened here, and are contributing to the state of our marriage, mean it no longer feels like my home. I can’t wait to leave.

I think possibly it’s too late to say, “Thanks but no thanks for the offer, dad,” as the sale is going through.

@Collaborate Oh God. Really? Well I think I’ve well & truly shot myself in the foot then.

I’ve made an appointment for a free half hour session on Friday with a solicitor.

@Collaborate, even if, until after the divorce settlement, I will only be renting it from him?

It’s complicated. It’s not something you can cover in a free half hour. Pay for some proper and detailed advice.

@Collaborate I do intend to do that. I’m was just going to attend the free advice appointment as a starting point, & then possibly go with another solicitor altogether, if I feel that’s in my best interests. Thanks.

It’s not too late to say “thanks but no thanks”. The goalposts have moved. If the new agreement doesn’t make financial sense for you once you’ve had legal advice then your dad pulls out of the purchase and you come up with a new plan.

It seems your dad didn’t look into the full financial implications either before putting this all into motion. The blame isn’t all on you.

If you've not exchanged on the sale you can still pull out. It happens all the time. Will it be after you see the solicitor?

Money isn't the only important thing on divorce so if you genuinely want to be out of the current house and given it sounds like there is a fair bit of maritabl money and the company and the properties the company owns it may not be the end of the world to move out although most lawyers except in domestic violence situations would say stay put. If you move out you prove you are housed elsewhere. I have not really read what the father intends to do to help but it sounded complicated and anything like that will have to be fully disclosed in the divorce process so anything tricky is a bad idea.

If the place the father has found is adequate and you want to move out (sorry cannot remember if there are children and who they will live with) then you can certainly do that. If there are children though they tend to want to stay in their own home so the person moving out also often loses the teenager children so do factor that in (although not little ones). I am not a divorce lawyer by the way so you do need your own advice.

What ever you agree with your father make sure his solicitors who are handling the property purchase which is in his name have a contract between you and your father setting out what is agreed eg if you will owe him money then that is a debt just like a mortgage on your home is a debt and will be looked at in assessing how much the total assets and debts are on the divorce. If you are paying him a market rent or any rent that is a cost of yours which could be relevant too.

Given the way the father is changing things around it would be better to stasy in the house. Even my husband was advised by his solicitor to stay in this house and did so not even just until decree absolute but until remortgage, house put in my name (I bought him out) and the money hit his account. Your divorce process might take a while - ours at 7 months was fast, no court hearings, no disclosure of money as we knew everything etc so I don't see why you should be paying rent for 2 years whilst a court case goes on whilst he is sitting pretty in the listed marital home.

The sale is going through?
Then your dad really has left it very late to change the goalposts.
So - when you get the money from your husband what is your agreement with your dad about how much you actually owe him? Only the deposit that he has paid, or the £ equivalent of that %? Given that you could be several years away from seeing any money, and property prices may rise, is he happy for you to benefit from that instead of him?

What do you mean by ‘going through’? Has your Dad exchanged contracts?

Sorry, no contracts haven’t been exchanged yet. I want to be out of here ASAP.
Honestly, it’s making me ill being here - the extreme lack of sleep, for starters, not to emotion the walking on egg shells & the mind games. It will be better for the children, too, to have two happy homes instead of one unhappy home.

However, I am now very worried that I’ve potentially made the worst decision. I have an appointment to see a solicitor - the first one I could get. I am just going to scrap the free appointment, as the one I’ve made today is sooner.

Thanks again for the replies. I really appreciate your thoughts.

I’ll speak to my dad about what happens if the flat increases in value. He has indicated that I will just owe him a fixed sum of money, & I trust him on that.

I will never understand why so many people are allowing themselves to be financially abused during a marriage. Why you’re staying with a man/woman for years on end without any knowledge about anything financial? substantial property bought during the marriage and you don’t have a clue?? and continue with the marriage even though he refused to put your name on anything??? this is mind blowing

@NeverGuessWho but you trusted him on what the rent payment would be, didn’t you? And that went up.

Why shouldn’t he take the profit from any increase, and you owe him more? That would be logical - it’s his investment. He wouldn’t even be screwing you over.

What does “indicated” mean? You need to stop acting on hazy notions - which is what led you into a potentially unwise property purchase and an unexpected rent increase before you even moved in - in the first place!

This isn’t about “trust”. This is about two parties clearly knowing what they are agreeing to. I really don’t think you do. Do you think it’s fair that you get the value of your dad’s investment? (perfectly fine if he wants to give it to you, but fair if he doesn’t)

He promised you one thing, on the rent - until he thought about it.
Why won’t he do the same, when he realises he hasn’t thought about potential price rises?

He probably hasn’t even thought about it, because you’re thinking your abusive husband who is with holding financial information is just going to give you some money whilst you’re still married. You’re probably both thinking short term, negligible price change. You could be 2 years away from getting any substantial money.

Pompei36 You are not alone. Many people have not a clue how emotional abuse works and how relentlessly it undermines the very abilities and strength you need to resist it. And this feel able to make unhelpful comments to vulnerable posters.

OP: it is absolutely understandable that you want and need to get away from him. If your Dad “happens to have a place that he can let you live in” so much the better.

I am glad you are seeing a solicitor: concentrate on the divorce and getting your fair deal. Good luck.

BlouseAndSkirt- how is she vulnerable? her husband is loaded and her dad is buying her house??? she’s in much better position than 90% of the posters here, all she needs is good professional advice and 🎾 to get what’s hers.