Buying partner out

[nextweekfriday]

Hi just after some advice or tips from others that have done this.

My partner and I have a house mortgage 475k, equity 90. I can afford to pay half of the equity and my family at going to help me to buy my partners share so I can take the property on on my own. My question is if my partner refuses to let me buy him out is there anything I can do legally? I'm keen not to disrupt my daughters life and was thinking staying in the house would be minimal disruption for her. There will be a mortgage penalty presume as we're in a fixed deal til Xmas 2023...which I'm not sure how that would be covered taken from a share of our equity. We have 30k of his personal debt on the mortgage.

Would appreciate any thoughts?

I recently went through this.

I am assuming you are not married as you mention 'partner' not husband which was the same in my case.

Firstly, it depends on how you both own the property, whether tenants in common or joint tenants. Tenants in common, there will be a deed that details the ownership split. Joint tenants is 50/50.

My ex and I split last Christmas with a mortgage of £340k outstanding on our home and our fixed term ended in September.

Firstly, I contacted the mortgage lender, explained the situation and went through the affordability process. They wanted to make sure I could afford to take on the mortgage and I could add off any settlement to the other party by adding to the mortgage. I could not borrow any more than was outstanding so had to get some documents signed by my parents to say they were gifting me funds to pay off the leaving party.

Once the affordability was passed, I instructed solicitors to deal with the transfer of equity.

Once I owned the house, I was able to take on the rest of the mortgage fixed term and apply for the new fixed term mortgage.

You shouldn't have to pay an early redemption fee as long as you can pass affordability for the mortgage as it stands. You will have to pay stamp duty on the share you are buying, less the share of the debt you are taking on.

My solicitor told me to negotiate negotiate negotiate with my ex partner. Going to court to under TOLATA at the moment is taking up to two years and costing circa of £40k per party.

Thank you so much for your reply.

Yes we are not married.

What I will be doing if having the mortgage adjusted so at the moment I pay 50% of the mortgage which is 475k, my family will give me 250k. And I will be paying him fifty percent of the equity directly to him presuming our house hasn't gone up too steeply since we bought it a year ago - we redecorated upon moving in and re plastered, retired etc. So it sounds like I need to calculate stamp duty.

Your point re negotiation with my partner that's what my concern is, he put a lot of energy into reneovating the house and my friends and family think he won't want to agree. My only bargaining tool is the shared interest of our daughter and keeping a stable home. Did you have kids?

We are joint tenants

Yes we have two children. It was very stressful, but for me, luckily he just wanted to walk away (from all of it, house, kids and me) so I got away with paying a small amount.

50% of the equity is a very strong offer, he wouldn't get more than that in court, and to get to court would be costly.

My solicitor also told me that the childrens act trumps most. So I set about proving I could afford to keep the house on, keep the eldest in school where he was doing well. I was local to my friends (family a bit further away) my job. Any move would have been detrimental to the children.

It would come down to his housing needs and with a 50% of the equity offer you are meeting them. As that is the maximum he is entitled to.

I also argued (his family wanted estate agent valuations on the property) that the value of the house was what a mortgage lender was willing to lend against it. Which was significantly less than agents, but in the volatile market does have baring.

An estate agent could tell me my home was worth £1m but if a mortgage lender valued at £500k then that's what it's worth.

Also, my ex had not funded any of our renovations, I had so that put me in a strong position but I can see that's not in your case.

This is so so helpful thank you so much I really appreciate this.

Is the childrens act relevant if you're not married? My concern is my partner will drag his heels in and just want us to sell out of spite so if there's an legalities that could support my case I'd like to advise him of that.

Did the lender not want to do a property valuation? That's all I was expecting to do.
We split the renovations costs 50/50 my only other bargaining factor with him is that I agreed for 20k of his sept and then a further 10 to be added to the mortgage...

I'm also wary about discussing this with him til all my ducks are in a row. But don't want to waste too much time either...my family can afford to give me 250 once they sell a flat which will take time so I won't have the hard cash til then.

Thank you I'm so relieved to be in touch with someone who has gone through this.

Honestly, it's not problem, if I can help I will.

How much equity is in the property (pm me if you prefer).

The mortgage company didn't want a agents valuation, they just wanted to ensure that the asset they were borrowing against could repay the debt in worse case scenario. They do not care about emotions, they just want assurances their money is safe.

The debt, is now absorbed into the mortgage, essentially it doesn't exist, anywhere but in your mortgage, but that doesn't mean you can't use it as a bargaining tool. Call the bluff, I did. God knows I did what ever was necessary. You could always put through a proposal to him, based on the average of the 50% equity across three agent valuations, then deduct his £30k essentially writing off any interest.

You can essentially negotiate anything you want. You could say 30% now and 20% when you remortgage in 5years. There's lots you can consider.

If you can raise any funds now, you could lock him in now, until the flat is sold. In my experience, the more time that passes the harder it gets. Anything you agree now, needs to be legally binding. I spent a fortune on legal fees that I hadn't factored in. My ex chose not to take legal advice, despite me paying for his solicitor.

In your shoes, I would get three market valuations, get a mortgage valuation (go though the process to get it started and get the other flat on the market asap). Get the ball rolling.

Yes, the childrens act comes into play whether married or not. Children of unmarried couples are not less protected than those of married.

Could your family buy his 50% against the flat? So it can move quicker? So they remortgage the flat, release the funds and buy his share?

Sorry, just read that you have £90k equity.

He won't take you to court for £45k share. Any decent solicitor will tell him the equity will be eaten up in legal fees and he could realistically walk away with legal debts rather than cash.

Court process will take 2 years and cost around £40k that was the advice I received. There's another bargaining tool right there.

Thanks so so much honestly the worry about this has been eating me up,, it makes such a difference to be in touch with someone like you! You must be so relieved to finally have the property.

My family don't want to remortgage (it's my older brother essentially selling his flat to cover my share of our parents house -inheritance I would get at some point).

Did you feel like you had leverage because essentially he couldn't force you to sell and you couldn't force him to agree to a buy out so someone has to relent? Then the only factor is the waiting game for someone to agree?

I'm worried about discussing this until I've spoken to the lender and incase he insists on selling but he'd need my agreement. I suspect I think one of the main factors of him not agreeing is he thinks I might move another man in in a few years which happened to his brother so I'm going to pretend my mum is moving in to help with child care.

My main point of negotiating is trying to put my daughter first she'll be starting school next year...

=> children act (schedule 1) applies to the unmarried.

I only completed in August, so still waiting for the rush of relief to hit me, but then the interest rate hit me hard! I would have been sitting pretty but at least I have my house.

I can't say I ever felt at ease knowing he couldn't force it, because he could. We were (are) very different people. I'm in business and up for the legal battle, but I didn't want it. He is more passive but did leave me for a she devil who wanted my childrens home (and my hard earned cash).

He can't sell without your agreement or a court order. So stand firm (for now, you never know what cards will be played and have to adjust) you are not selling.

You are going to make a good strong offer. A judge wouldn't agree to force a sale when you can buy him out at the market rate. The judge doesn't care for yours or his emotional turmoil. They only care about the child and a fair split. He can be as spiteful as he wants, and he will be but stand strong. This will take all your grit and determination, but it can be done.

As hard as it is, 'take the emotion out of it' deal with facts and figures and you will see it through.

A sticking point maybe that your child hasn't started school, therefore you could relocate without having a huge effect. However, you are buying his 50% share. No one will force a sale for that. You would also have the legal fees/agent fees and early redemption fees. It doesn't balance. He walks away with the most this way. He looses any other way.

Look on right move etc to see what houses in your area are actually selling for not what price they are listed for- that will give you a good valuation basis

he is entitled to 50% of equity less reasonable notional selling costs ( ie what you would have to pay if actually selling ( estate agent fees, etc)

if you can afford to raise that money and mortgage lender approve you for the mortgage in your sole name a court would not fit e you to sell just because he’s emotionally invested

however, my advice would be not to over burden yourself financially in an effort to retain the house. Stability for children doesn’t come from bricks and mortar but in their parents actions and knowing they are loved. People move all the time and children are quick to adapt

He could force you to sell - might be costly to do so but if you can sell, tags your share and use that as a deposit elsewhere courts would do thst. They’ll only use sch 1 to allow you to stay if there is literally no other option to house your children or he’s wealthy enough to not need any money from it immediately

How did you handle the period between deciding to split and it finally getting sorted? your ex try any dirty tactics like refusing to pay his share of the mortgage or leave you with all the bills? I'm worried that my partner could try that as if he didn't pay that could be another way to make me leap into action and have to sell...

To be honest, it all happened relatively quick (and it could have been quicker but I had to negotiate my package at work to pass affordability). He left in the December, i renegotiated at work in the January, supplied 3 mos bank statements in the April and had my offer. The legal paperwork was drawn up by June, signed in July and completed in August.

I was in a slightly different position to you, I was always the main earner, and I always kept myself in a position I could afford solely if it ever went to shit.

They tried many dirty tactics. Withholding money, refusing to sign, making accusations about me to the police, the works. I stood firm. It was master gas lighting tactics. It was a truly awful period of my life.

Your ex can stop paying as soon as he leaves the property to fund his living expenses. There's nothing you can do to enforce payment. You need to get yourself into a position asap where you can manage these costs. Every month he pays, look at it as another months breathing space.

Make your child maintenance claim and any benefits you maybe entitled to. Gingerbread website has a calculator I believe.

I would advise that time is of the essence, the longer it lingers, the more time for things to turn nasty (if they haven't already).

It sounds harsh, but he's your business opponent for now, that's the way I managed it although I appreciate not everyone's preference.

Surely you only owe him 15k?

The shared equity amounts to 45k each, and then you say 30k of your borrowings included personal debt of his?

Then of course you need to be able to take on the whole mortgage which is where your family come in and a new mortgage application

If she buys him out why and how could he force her to sell, he would get the same regardless

I’m saying if she can afford to buy him out at fair market value, release him from mortgage and give him his sgare then a court would allow that

but in the event she can’t do that, most likely she’d be ordered to sell

It sounds as if she can, in any case at the moment she only really needs to give him about 15k if the figures above are right, once she gets the support from her family she can then remortgage without him

He is extremely tight-fisted with money so I think he would insist the 30k of his debt on the mortgage goes towards the work he put in to renovating our former flat and the house we're in....we paid his brother to do a lot of work but he also spend a lot of evenings and weekends etc....

I trying to think through my tactics...I have to wait for my brother to extend the lease on his flat/property, get his council tenants out and then sell...once he's done that I will then have enough money to organise with the lender to renegotiate the mortgage for the house I'm in. I think if I present him with an offer and he's got a short period to agree that's the best way forward rather than saying anything now as it gives him the opportunity to start dirty tactics...

When supply bank statements did you also have to show your work contract out of interest? (Another complexity to my situation is my current role is a year long with work intending to make it permanent - I just to hurry that process up)

Sell could mean to the op
which is what she is doing
He doesnt get any more equity if selling to a third party

@nextweekfriday yes I did, they were very stringent with me. However, the advisor dealing with it said he had never seen such detail being requested. That may have been because I was mortgaging every penny i could (it literally came down to £100).

You need to ensure you can afford the mortgage left after the £250k injection and pay off.

I have an eye watering £340k mortgage but I look at it as rent would cost me the same if not more

My mortgage broker was telling me there's extra scrutiny at the moment because of the economic crisis

@nextweekfriday I can well believe it. I literally had to jump through hoops. At one point my childcare bill was £20 per month too high.

It's incredibly stressful, I'm in my late 30's and the first of my friends to go through a separation. I did a lot of reading and asked for a lot of advice.

So much so, that when my youngest starts school I would like to study family law on some level.

It's hard, but not impossible