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Divorce/separation

Here you'll find divorce help and support from other Mners. For legal advice, you may find Advice Now guides useful.

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Original poster

Separating from DP, can't afford to buy his share of our house. Options? Transfer of equity.

22 replies

NordicNoirRocks · 27/05/2015 20:33

I'm splitting up with my DP of ten years, we have two DC together. We are joint tenants on our mortgage, which also includes a 25% shared ownership owned to a private housing association.

I estimate the residual value of our property to be £50K, after deducting the remaining mortgage and shared ownership equity. Even though I'm working full-time, I have no savings and a bit of credit card debt so I could not afford to pay DP his share of £25K.

I would like to stay in our home with our DC, and I could meet the mortgage payments on my own. Does anyone have experience of making a Transfer of Equity, so that DP retains a share of the property, to be realised upon the eventual sale?

this would be my preferred option but tbh I can't see why DP would agree to move out, without a cash payment of his share. How could I persuade him that this is a good idea?

Thanks in advance.

OP posts:

Newbrummie · 27/05/2015 22:25

If you are housing the DCs it's not 50/50 ... I've known women without DCs get 70/30

Original poster

NordicNoirRocks · 28/05/2015 06:35

Why newbrummie? We're not married, and we're not allocated a uneven share to the property on the mortgage deeds.

OP posts:

Hammondisback · 28/05/2015 06:48

Please check this, as I'm not a legal expert, but I thought you were entitled to stay in the house until the children are 18 or out of full-time education.
If you've had the house valued now and can keep up the mortgage payments yourself, you can then pay him off with your share of the current equity when the DC reach this age. I think, though! As I said, please check

Good luck.

Hammondisback · 28/05/2015 06:52

Oh, I should've read your post more carefully, that's what you were referring to! A work colleague of mine has done this, but I'm not sure how it panned out. Sorry, I've not been more helpful

Newbrummie · 28/05/2015 06:55

Are the children his ? If so he has to provide a home for them. It's not as simple as 50/50

LineRunner · 28/05/2015 07:05

Your former partner having a charge on the house for a share of the equity in the future is pretty standard. But negotiate hard on that share, as you will be taking on all the mortgage. I certainly wouldn't be offering him half.

Normal arrangements are that the sale takes place either when the youngest child has turned 18, or you remarry/cohabit.

You do need a solicitor. And best of luck.

Original poster

NordicNoirRocks · 28/05/2015 07:43

Thank you so much for all the replies, very helpful!

I will get a solicitor.

OP posts:

wannaBe · 28/05/2015 07:59

the advice often given on here that the rp is entitled to stay in the family home until the children are eighteen simply isn't true. While this can sometimes be the case, the courts are less and less willing to grant mesher orders for various reasons:

1, it means the exiting partner is unable to move on in their own right as they are still on the mortgage and therefore unable to be granted a mortgage in their own right.

bear in mind that the equity will be based on the sale of the house at the time of sale, not at the time of the order being granted. So if house prices go up then he will be entitled to the proportion of equity agreed but with the figure being that at the time of sale. Conversely, if house prices were to crash and you fall into negative equity you would jointly be liable for the debt.

The other alternative would be for you to take out a mortgage in your own right but with provision being made for him to be given a set amount when the children turn eighteen, but equally this means neither of you really moves on, and you will be liable to pay him that amount regardless of the house value at that time. Also given the HA have a 25% steak changing the mortgage arrangements may be complicated.

You need to see a solicitor, but I would seriously consider whether this is really the best way for you to all move on...

LineRunner · 28/05/2015 08:06

In my case, I took out a loan to buy my ExH out of his share of the equity completely. I would say it was 10% of the equity. But he bit my hand off for it.

The court (this was a divorce) found it fair. After all, I got custody of the whole mortgage... And the absconding Ex got his deposit for a new place.

Emochild · 28/05/2015 08:12

I think quite often the advice on MN is for married couples divorcing

I was not married, the children stayed with me, I saw 2 solicitors

It was a 50/50 split and he could have forced a sale had my parents not topped up what I could increase the mortgage to in order to buy him out

It's crippled me financially and I wish I'd sold up at the time

Original poster

NordicNoirRocks · 28/05/2015 12:59

Thank you. I do not think I could remortgage to cover DP's £25k, but I will make enquiries. Tbh I do not see any reason why DP would agree to move out without his share, as he would be unable to buy somewhere on his own without it. I would like to keep the house though, for the DCs benefit. I'll make an appointment with a solicitor.

OP posts:

Kewcumber · 28/05/2015 14:08

The children are entitled to be supported by him, decide how much (with advice from a lawyer) how much that support should be say it is £300 per month work out how much the repayments mean in terms of a loan payable over the say 10 years until the children are 16/18. (A £25,000 loan payable over 10 years shouldn't cost you more than about £300 per month).

He takes out a loan of say £25k and keeps the cash (in lieu of his share of the property to do whatever he wants with) and pays the £300 loan repayments instead of paying you maintenance for the children. You will then need to take over the mortgage and won't get any additional financial support from him.

Of course this does require the mortgage company to agree to transfer the mortgage solely into your name (not a certainty) and it does commit your ExP to "maintenance" for the duration and he can't take a decision to reduce it for any reason.

You on the other hand will be paying all the mortgage without any financial support from him. But it's impossible to split one family into two properties without finances being tighter.

worridmum · 29/05/2015 03:03

kewcumber that is a terrible terrible agreement for the ex partner he would have to be completly daft/stupid to accept that as their would be absolutly nothing to stop the OP from going stright to CSA (or what ever they call themselves now) to get child maintance + the new fees for them to collect it from him and they would not be intrested in any prior agreements between them.

No solictor would ever advise someone to take on that sort of agreement the best you can really hope for is a mesher order for when youngest turns 18 (but does not count for any new children you have if any with future partners my friend found out about that when ignoring my advise) and it would also end before they turned 18 if you move a partner in / re marry or of course sell the house (and also if you start renting out that property while moving somewhere else) and like said mentioned earlier judges are issuing mesher orders less and less now for all the reasons stated previously.

But realistically you need to be prepared to sell the house or take out a loan / remorgae/ ask friend or family for a loan to buy out your ex-partner

Kewcumber · 29/05/2015 09:52

I know its not an ideal agreement for the exP but the exP didn't ask for advice on how to keep the house - OP did!

If OP reneged on the deal and went to CSA then partner can force her to sell the house to pay off his loan.

It depends really how much OP's ExP wants the children to stay in the house. I know men who would/have taken a small risk in order to do the right thing by their children, depends w.hat kind of man the exP is

Newbrummie · 29/05/2015 10:01

And that's what she's about to find out! Do it quickly OP the more hard done by feels and he will as time goes on .... Mine had three affairs and it's still my fault, the less amicable things get

worridmum · 29/05/2015 12:59

but its not a small risk is kewcumber? its a whooping great big one (and if the OP do go to CSA after the agreement which is her legal right but morally very shitty thing to do he will be unlikely be able to sell the house as the mesher order would be made and he would be so much worse off with massive debt he would have to pay on top of CM
(CSA does NOT take account of debts / rent / outgoings when arranging maintanice so 300 debt + what ever CM is worked out at could very well bankrupt him (aka would not have enough for rent/food/bills etc)

but hey other people consider that a small risk (its not if i had that it would of wiped me out and i would not be able to afford to rent / pay a morgage and woud end up at best in a bed sit / house share which beyond your early 20s is completely shit and rightfully the OP would object for her DC being in those conditions so he would also lose out on seeing his children on top of everything else)

So like i said before he would be a complete idiot to agree to something (even if OP signed a legal document saying she wouldnt go through CSA its as good as toliet paper in the eyes of the law so no protection what so ever and if he has a solicoter it would be a no go anyway)

So its better to prepare the OP with realistic outcomes of ether having to sell the house (most likely outcome these days) or a mesher order where likely he will get 50% of the value on the sale of the property (at time of sale not time of separation which is only fair as he would of had the money himself to invest so would possibly would of had the same value return )

SleeplessButNotInSeattle · 29/05/2015 22:58

Rather than taking out a loan and then making the repayments, could OP's DH just sign over the equity in lieu of child maintenance payments for ten years or so?
With OP becoming sole owner of the house, with housing association?
Could that be a legal binding agreement?

pookamoo · 29/05/2015 23:03

Rather than all of MN coming up with plans, I think the OP has hit the nail on the head with I'll make an appointment with a solicitor

Unless all the previous posters are family lawyers?

OP, I wish you all the best.

worridmum · 30/05/2015 18:29

I am a family lawyer hence why I was saying the plans where terrible but making an appointment with a solicitor is the best bet but they wont say much different to what I said

Kewcumber · 30/05/2015 19:30

I'm an accountant I think my plan sounds not terrible at all for her.

I agree a solicitor is the way to go but OP had already said she would see one so no harm in pointing out how she could effectively give him the cash and keep the house.

I did, you should note, point out that the mortgage company might not agree, he might not agree and it might prove too expensive for her to manage.

Smorgasboard · 03/06/2015 19:08

Been through this, got a mortgage to buy P out. Basically you are entitled to half the house as is he, because you are not married. Much as you love the house, I'd advise you sell and each take your equity. P did very well out of buyout as value was at its peak before the crash - still not worth 2008 prices. Tying yourself to large debt long term could make for a miserable future.

cannotseeanend · 03/06/2015 21:12

I just had to give my husband a lump sum equal to about 20% of the value of the family home. I had huge problems getting a mortgage offer, I ended up taking 2 bank loans over 5 years, one loan at an excellent rate comparable to mortgage rates and the other twice the interest rate and I'll be paying it off early to avoid the interest. I didn't think it would be easy to get these loans, but surprisingly the same banks who refused me a mortgage offered me loans! So that's how I did it. I found paying for experion membership and reading up lots on credit ratings was essential. I asked for 6 or so loans, all at same time, so no company could see the other loan applications, chose the 2 best offers, my ratings went from excellent to fair as soon as the credit searches made it onto my profile, by which time I'd started paying back the loans. I basically kept one step ahead of lenders. Crazy really. But it worked. moneysavingexpert.com is a great resource.

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