Help! Someone who’s good at maths, how much do I owe ExH?

[PuddleCake]

I’ve sold family home and we are splitting the profit (just the profit, not my equity) 70/30 to me. Ex and I have come up with different calculations….

House sold for 710k

I bought it for 327k (this included mortgage of 175k, I have £155k left to pay on it). Ex wasn’t on mortgage and didn’t put any money into sale.

I've spent 100k on renovations, this includes all legal and estate agents fees

Ex spent 27k on renovations

I owe ex 7k from previous house renovation

Of not married and it’s not his house not on portage etc just give him back what what he put into it’s so 27k +7k! If you really want to do the split 70-30 then tell him it’s 100k or nothing because that’s bloody generous since your not married so he’s not Leah ally entitled

"House sold for 710k

I bought it for 327k (this included mortgage of 175k, I have £155k left to pay on it). Ex wasn’t on mortgage and didn’t put any money into sale.

I've spent 100k on renovations, this includes all legal and estate agents fees

Ex spent 27k on renovations

I owe ex 7k from previous house renovation"

710-327-100-27= £256k profit - 30% share is £76.8k

or if you really want to 'pay back' the £7k:

710-327-100-20= £263 profit - £78.9k plus £7 that you owe is £85.9k

What he doesn't get to do, is double dip (ie. you shouldn't be calculating the profit including his £27k, then paying back £7k of it).

This is also the figure I came up with, £110.8k to him, £272.2k to you (just from the profit and accounting for the £7k you owe him).

Has the fees for house sale been taken out? Fee to estate agent etc?

Dont forget to deduct any estate agents and solicitors fees for the house sale from the profit.

@AutumnCrow you mean £10k or really only £10?

Well, it depends on what you are considering part of the costs vs the profit. So, there's a strong argument that once you have paid off the mortgage that's left, anything that's left is the "profit" and that should be split 70/30 as per your agreement.

If you want to consider the cost of paying the mortgage, renovations etc, as part of the "pre profit" then it's going to get a lot more complicated.

Long time ago in a far away galaxy!

Ok this is what I got.

You paid £252k worth of deposit and work on house. He paid £27k. So once that's taken from £710 there is £431 left to split. (Take away any fees before split)

£129,300 to him the rest to you.

I think that's a lot to him really

If you weren't married all he is entitled to is the £27k he put towards improvements and the £7k you say you owe him, so no idea why you'd agree a 70/30 split in this instance.
If you were married what you put in is pretty much irrelevant if the house was bought during the marriage, you would just split the profit (sale price minus outstanding mortgage) 70/30 as agreed.
If you bought the house before marriage you'll need a solicitor to help sort it out if you can't agree (sounds like you might need one regardless).

Oops, minus the amount left on mortgage £155k. So £276 to split.

£82,800 to him. Plus his 27k

Could you argue that his contribution to the house with renovations was earning him the 30%.... So therefore you only own him the 30% and not 27k too?

Did he contribute to mortgage and bills? How long were you living in the house before he moved in? How much was left on the mortgage when he moved in? Do you know how much the house was worth when he moved it? You could also argue that he only get 30% on the value of the house since he moved in. Not on the whole value from when you bought it?

OP still has to pay back the mortgage outstanding though, so the proceeds from the house net of mortgage is not 710k.

Giving him back the 27k is not double dipping unless the OP has already paid this back in some form.

Think of it this way:

Proceeds are 710. From this, everyone first gets back what they paid in, so the OP gets the 327 she bought the house for (and pays off the mortgage from that, how she financed the 327 she put in is her problem) and the 100k she put in for renovations.

The ex gets the 27k he put in for renovations.

What you have left over is the profit, i.e. the proceeds minus the total cost, which is 256k. This is split 70/30. So ex gets 76.8k of the profit.

Then the OP pays back the 7k she owed from a previous house.

76.8+27+7=110.8k. This is what she owes ex.

@PuddleCake I think @CatherinedeBourgh calculation looks right

What is the legal ownership of the house? (100% yours?)
What is the tax implication of you 'gifting' him part of your proceeds?

710k-175k=535k equity

Your equity is 427k (327+100)
his equity is 34k (27+7)
together these make 461k

535k-461k=74k
split 70:30 this makes
£51,800 : £22,200

so you would get £427k + ££51,800 and he would get £34k + £22,200 (£56,200).

I would note that £427k is 92.6% of the total amount that each of you have put in. Based on 92.6% verses 7.4%.

With this split, you should get £427k + £68,524 and he should get £34k + £5,476.

I would note however, that he should pay the same percentage of the mortgage as he gains in the split of equity. So if the split after repaying capital is 70:30 he should pay off £52,500, leaving him with £3,700. If you go for the £92.6% split he should repay £12,950, leaving him with £26,526. Ironically, receiving a smaller percentage of the equity, because it involves paying back less of the mortgage, leaves him better off.

If you weren't married all he is entitled to is the £27k he put towards improvements and the £7k you say you owe him, so no idea why you'd agree a 70/30 split in this instance.

This.

Sorry - I messed up by thinking you had put more deposit in then you have, but hopefully you can see the process.

Honestly, his input is so negligible that he would be best off if you just repay his capital. Any more than that should be offset by mortgage contributions, leaving a minimal amount more.

Surely you just owe him £34k
Why would you give him any profit on a house you own and paid for?

IN law as you are not married and the property is not registered in joint names, he is entitled to a lot less than you and he have agreed. Whatever you decide have the exact sum in writing and both sign something (ideally using a solicitor) confirmint this is full settlement of all claims either has against the other so he does not come back for more later.

Thanks so much everyone, glad it’s not just me with the calculations!!!

YABVU to imply you were married in the title of the thread as this changes dramatically the legal position.

If you are not married, then a moral/fair settlement is the renovations money 7k you owe him plus the 27k he put in. No more.

If you had been married then this would have been thrashed out by solicitors during the divorce as part of the financial settlement .

Hang on, he's not on the mortgage and didn't contribute to the mortgage? Only put £34k in (27 plus the 7 you apparently owe him)? And he wants over £100k from you?!

You're not even married. Tell him he can have £50k and then fuck off

Without looking at what others have said yet, my first thought is his share, rounded up slightly would be about £150k. If you’re looking only at profit not including your equity shared equally.

When you bought your equity was about 46%, so I took that away from the total equity that you have now, because that’s yours, and then split what was left. Now going to look and see if others are thinking along the same lines.