Sister demands half the profit from the sale of the house after not paying for 16 years.

[TheBorgPrincess]

Usual disclaimer- all names have been changed for privacy.

I (41F) bought a house with my younger sister Claudia (34F) 17 years ago (2006). Both our names went on the Mortgage at my parent’s behest. To make Claudia ‘Feel grown up’ and perhaps she would be inclined ‘to take the bills seriously’. As was earning more money than her at the time, we agreed that I would pay two thirds of all bills and Claudia would pay the remainder. (Somewhere in all the paperwork, I do remember ticking a box that said Tenants in common and not tenants in Law. Which I believe recognises an uneven split in ownership?)
Anyway, after 9 months of living together and after a silly argument about the washing up. Claudia packed up her things and left to go back home and live with our parents. I really don’t think she could afford her share of the bills and didn’t like spending her money on living essentials. Claudia promptly handed her key over to our dad and nothing was discussed or agreed. Our relationship was slightly fractured after this, but we remained cordial at family gatherings.
I really struggled to afford the bills on my own at first, but by taking a second job and knuckling down at work I earned a promotion and was soon comfortably able to afford everything with a decent quality of life.
Skip to 10 years later and Claudia is in a relationship with Matt. Matt ‘Flips houses’ for profit. Selling some and renting out others. He’s made a successful business out of this. Out of the blue I receive a scathing text message from Claudia demanding I remortgage immediately to take her name off the mortgage. From what I understand Matt had maxed out the amount of properties he could get with just his name and wanted to start using Claudia’s. She states that she doesn’t want to be bought out, just her name taking off the mortgage. She’ll even help pay for the legal fees. I get to own 100% of the house, she gets to build a property empire with Matt. Win-Win! Off I trot to a Mortgage advisor and explain the situation and there’s a few options- I just need to get the house valued. I pay my fee. Alas, the house is in negative equity! The mortgage advisor completely vanishes in the ether, doesn’t return my calls. I get a nasty text message from Claudia (GOD! I wish I’d kept these!) that she’s going to get a solicitor involved and force me to sell the house at a loss. I was absolutely heartbroken at the thought of being forced to give up my cute little house and my home of over a decade. I really didn’t what to do. My Parents aren't much help- they just shrug their shoulders. A few months later Claudia and Matt split up- all goes quiet, and I breathe a sigh of relief.
Fast forward another 5 years. I get offered a fantastic job opportunity BUT it involves a relocation ASAP! The company I work for offers to pay for a full relocation package- the whole she-bang plus they’ll pay for rent on a house for 6 months close to where I need to be so I have chance to sell my house.
No takers. The Estate agent recommend renting it out. It’s in a great location if you commute and it’s close to a lot of amenities, the area has had a bit of gentrification. It’s barely on the rental market for 24hrs before It’s snapped up. I rent it out for just enough to cover the mortgage and the landlord insurance, hoping it’s an investment for further down the line.
So, to be clear I try to sell the house – Claudia is aware but is not interested. I rent the house out- Claudia is aware but not interested and makes no comment on the situation.
4 years ago, the tenants stop paying rent (Just scumbags, but that’s a whole other story). After a lengthy year long battle which nearly broke me mentally and financially-They tried every trick in the book. I secure a successful eviction order and after the bailiffs have kicked them out, I am left with a completely trashed house. It was disgusting. Claudia is aware of this and makes no comment. My parents after seeing me struggle financially help me with the costs of a quick whitewash, several tip runs and a professional deep clean so I can get it back on the market to sell.

For the past year I had to pay both the mortgage and my own household bills. There’s just my wage, as a single person in a Cost-of-Living Crisis. I’ve blown all my savings, maxed out my credit card and had to take a loan out to make ends meet. I was hoping that the proceeds of the sale would allow me to pay everything off, get me a new car and a modest deposit on another house.

In what feels like the only good news of 2023. I have a buyer for the house. I didn’t quite get what I wanted, but I can’t afford to go on like this any longer. I want rid and quick.

Claudia is now asking about how much her share of the profit is, and how much is left on the mortgage. To be quite clear she hasn’t paid a penny towards the upkeep or mortgage of that house for over 16 YEARS! I am shocked but not surprised by the sheer audacity. Somebody has whispered in her ear that as her name is still on the mortgage she’s entitled to HALF of the profits from the sale! I have also found out that she’s taken out a large loan (for a boob job) stating that she is a property owner. My parents don’t want to get involved. They don’t want to come between sisters! My Mother hints that I should take pity on her as she’s now a single mother of two, while my dad thinks I should get legal advice and try to fight her in court.

Is there anything I can do? Or is it more fool me for not remortgaging sooner? She’s set foot in the house twice in the 16 years since she left, and apart from when she was in a relationship with Matt hasn’t said anything and was quite happy to let me keep her credit score nice and high as I’ve never missed a payment. I’m worried that if she doesn’t get her own way she’ll refuse to sign for the sale of the house.

This is a message board right and not a legal forum? Or am I mistaken

It is. But regardless of any legal knowledge, you must realise your advice (treat sister like a bitch, ensure she gets nothing) is poor and not going to actually be possible. Surely?

Did you read the post through?

To be fair , it would be a plan to allow the half share of mortgage she paid solo on your behalf when you stopped paying,
profit is a whole other matter
mad without your joint initial investment
and joint ownership there wouldn’t be a flat

Poor you, so stressful, your sister sounds selfish and materialistic.

if you add up all of the costs over the 16 years including the repairs, mortgage payments, eviction coasts, you could argue she needs to pay half in return for half of the asset gain, you don’t say how much the latter is but based on new car/Deposit then I am assuming the 50% of costs could wipe the gain?

She's entitled to your original agreement I'm afraid. Stick with your solicitors advice.

You need to speak with an attorney, because if her name is on the deed, by law, you will need to split the profit.

If her name is not on the deed, deduct all the costs for maintenance/tax/upkeep/management plus the mortgage payments from her half she did not make and whatever’s left from that then she can have it. And obviously those deductions swing into your column.

If you read the OP it is obvious that her sister is on the deeds. As they are tenants in common, this will be recorded in the title deeds held at the land registry.

Seriously, there is a load of rubbish in these comments, you need to speak to a solicitor as many have said. There is definitely case law relating to proof of payments of mortgage/towards house costs and having an impact on any entitlement. I remember this coming up in my Property law modules, I just don't recall the details as it was a long time ago and I don't feel it appropriate to offer 'of course' advice on matters I am not qualified to advise on!! Your parents haven't helped the situation at all

The profits will be what is left after your expenses are taken out. You can show your expenses and share what is left. It’s a pity you didn’t get this settled at the time, but that doesn’t help now.
My brother, sister and I had a similar arrangement but my contribution was less than theirs so it was no problem that I recieved less. BUT when our mother died they were executors and not only took more money than they were entitled to under the will, but robbed the estate blind. I haven’t received the legacy I was due nor the residual entitlement and I’ve lost £18k. It just goes to show you should never trust family arrangements.

Such case law relates to instances where the house is owned by one person and their ex-partner is trying to establish an entitlement to a slice of the house. That is not the case here. The house is jointly owned. Absent any evidence of an agreement for a different split, OP and her sister are each entitled to 50% of the proceeds from any sale after the costs of sale are deducted.

Do you have proof she has paid none of her share of bills/ upkeep? Age owes you whatever percentage her share would be. That can be deducted from any profit she would derive as repayment of a loan (effectively). But that may not be too easy to argue in court. Get advice from a solicitor.

I'd also suggest that, if your mum is keen for you not to pursue, she ponies up the money that you will lose.

Nope. Unless there is a clear agreement to something other than a 50/50 split of the profits there is nothing that can be done. Sharing bills/mortgage is irrelevant when it comes to how the property is owned and in this case it’s a 50/50 split after selling costs are covered.

You know you can take legal action against executors who don't execute the will properly?

In addition to the mortgage payments make an extensive list of all the expenses you have incurred over the years
including
decorating, carpets, kitchens Gardens, plumbers, legal expenses, estate agent fees management, I’ve let et cetera. All of this can be put against your share of the house, and the fact that she hasn’t made any utility contributions council tax concert. Also your council tax contribution etc etc
all of these expenses will be allowable, and the fact that she hasn’t made any contribution towards the mortgage payments et cetera will be taken into account. You need a good solicitor don’t delay

The OP would be paying all that if they owned it outright, and most of that if they rented.

It will eventually come down to contributions
all about numbers

There is no profit. Explain that you spent however many £000s over the past 16 year and the house sold for less so no profit is available to share.

A lot of posters are posting what they want to be the case instead of what is actually the case in law. What it comes down to in the end, is the legally agreed joint ownership of the property. If there is nothing to state otherwise, then whatever the original agreement was when the property was bought still stands. The agreement to pay the mortgage is solely with the mortgage provider, and who has paid what, and to whom over the years, means absolutely nothing, as the wording on the mortgage agreement will be that they are each responsible for the payments both jointly, and severally. AS long as the agreed payments are being made, the mortgage company doesn’t care who is making the payments. The OP has already stated that they are both named on the deeds to the property and the ownership is joint tenants in common. So the OP and her sister each own 50% of the property and are each entitled to an equal share of the profit, once the selling expenses have been covered.

Sorry but this is entirely wrong. What the OP has paid out over the years is of no consequence if both parties are named on the deeds, and they are joint tenants in common, as OP as already stated. Both parties are entitled to a 50% share of the profits once the selling/legal fees have been paid. They are both jointly and severally liable for the mortgage payments, meaning that as long as the payments are being made, the mortgage company really doesn’t care who is actually making the payments.

If the OP and her sister are tenants in common, the sister will be entitled to whatever split is on the deed document.

Eg. 50/50. House was worth 100,000, then 50,000 each. House now worth 300,000, each get 150,000.

It doesn't matter about bills and mortgages, all that matters is what is on the deed.

Actually my similar experience, nothing to with the mortgage company was all about who contributed what over years

The split isn't recorded on the property deeds.
It depends whether the split was separately recorded. It's often overlooked.

They’re tenants in common so will be a 50/50 split.

Morally, you don't owe her anything but unfortunately that isn't what matters. You need proper legal advice and probably she will get something. You need to find out your legal situation which you won't do on here. Lawyer up ASAP.

Good luck.

I suggest you actually read the thread. Then you will see that I, and other lawyers, have confirmed the legal position which is that the sister was not entitled to more than half.

Where you got the "she will probably get something" from is beyond me. Do you always take a wild guess about these things?