Would letting my husband buy me out make financial sense?

[PoisedUmberCrab]

Hi all. Grateful for some perspectives in relation to a divorce / housing situation.

1. Husband and I getting divorced.
2. We have 2 children aged 18 months and 5 years old.
3. We own (as joint tenants) a property worth £950,000.
4. The mortgage is £670,000.
5. we have paid 50% each of the mortgage and house bills for 7 years.
6. Property is 5 mins from school, 2 mins from nursery and 1 min from my parents.
7. Agreed that husband will have his £75,000 deposit returned (money came from his mother - it doesn’t feel morally right to pursue it).
8. Husband has suggested buying me out, to the value of approximately £100k.
9. His rationale is that, if we sell and both buy separately, we will incur early mortgage repayment charge (c £10k), legal fees (£5k), estate agency fees (£20k), two sets of stamp duty on new properties.
10. putting sentiment aside, I think I’m ok with the idea of moving out. Less upheaval for kids (one new home vs 2). Part of me worried they won’t want to leave the house to come and stay with me but that’s another story.
11. Has anyone done this - how did it turn out?
12. Did it make better financial sense?

Tbh I’m not sure what is fair

tho easier to start afresh and not have memories if stay in same home

obv being near parents helps

area makes a diff. If south east then may be a 4 bed

wouid it make sense to sell and split profit after mortgage paid off and buy smaller places

As others have said, pensions etc need factoring in. But even parking that, the split is unfair. He keeps all his £100k as house equity but you have to deplete yours with stamp duty, conveyancing solicitor, cost of setting up home. You will end up with much less than £100k in equity after all that. So the split doesn’t work.

100k is not enough on a property worth 950k. He is not only not having to incur the costs of moving and restarting, he is also sitting on an asset that will likely be worth alot more in 20 years time when the kids leave and he sells. Have you had it valued recently? Or is that what you paid for it?

But you’ll still have to pay all of the fees when you try to buy a property.

And does he have the borrowing capacity to have you taken from the mortgage

You think he should pay her half the house's value and take on all of the mortgage? Goodness me.

If the company is owned by him then presumably half of that is yours too. So is he borrowing against his company to pay you and giving you half the value of the company?

He'll be taking on the full mortgage alone so he'll be paying for that mortgage. The OP needs to have a full financial disclosure of all assets before she can make a decision - but on the basis of just the house - this is a fair deal.

Wow you’re really selling yourself short here op. He’s a business owner and can see you coming.

What is right and what is necessary to give your kids the best outcome are different. Personally I would take your half of the 75k and use that to set yourself up.

I would be taking into consideration moving costs, set up costs, furnishings, getting new contracts on things, the consumption of time etc. Don’t underestimate all the hidden costs there.

And what happens if he doesn’t like his 40% and ends up being an EOW dad and starts hiding his income? Business owners can do all sorts. You’ll be paying the nursery fees alone and seriously struggling.

You have provided him with 2 kids and their 60% of the time with you should be in as near as damn nice place as dad’s. His earning potential is clearly higher than yours and it sounds as if he is earning well. He will recoup 37.5k in no time.

All he’s interested in is keeping the family home by the sound of it and seeing what he can get away with whilst spinning a yarn or reasonability.

Get yourself a decent solicitor. They will advise against your plan.

Seemingly many people commenting don’t understand that it’s common and allowable ( even if court ordered) to deduct fees and costs as if buying at arms length . That is standard practice.

those saying you should get a lot more have no legal basis for this ( nor currently any others ones as we don’t know the total assets or what he earns

before deciding make sure you know and agree on the total asset pot and how that will be split rather than agreeing ( or arguing) on one part of it

This but I didn’t explain it well in my reply

What is the mortgage balance rather than the original mortgage? It’s not too far off the mark but don’t underestimate the costs of buying, he won’t have them so I’d be pushing for a bit more

You need to see a solicitor.

One of you buying the other out is reasonable. Given the numbers you provide, the amount is correct.

just don’t forget to include things like pensions and an amount for your moving costs.

Tbh if he is a business owner and already trying to short change you I would aim to get the divorce and financial agreement sorted asap. He can yld get very sneaky.

He needs to buy you out of the company too. As well as the house. Legally half of that deposit could be yours too if you wanted it so you can explain that to him as leverage of he gets unreasonable.

I actually agree with pp that you would benefit from seeing a solicitor for an initial session as these are very large assets in question and you have a lot to lose.

Why should you end up in a worse financial situation then your ex while also doing significantly more of the childcare??

950 - 670 mortgage = 280 equity
280 -75 deposit ( paid by ex DH) = 205 he is only asking for deposit back not a share of growth on deposit which is good and very reasonable
205 split 2 ways is 102.5 each
OP should probably argue for a bit more as she will have costs buying a new property which he will not so 110-120K might be more fair
divisions of pensions and savings are separate
however they have both paid 50/50 of mortgage etc for 7 years so the equity is equal
child maintenance and split of childcare bills going forward are a separrate discussion

I think it's generally not a bad idea, but both your pensions need to be valued if you are married. If his is worth more it might top you up to 125k ish
Can you move in with your parents 1 minute away for a while and have the kids there?

You absolutely cannot agree this in isolation from all the other finances. At the end of the day, in these discussions it’s not a home, it’s a joint asset to be thrown into the pot and divided according to need.

It sounds like this will include his company shares, pensions, and probably savings, as well as the assets in the house.

Agreeing to £100k against the house now is just not possible. You can agree that, if it works financially, you will agree in principle to be bought out.