Transfer of equity following relationship breakdown

[Anon4567]

Hi,

I'd really appreciate some general advice on the following scenario. Apologies if this is overly long. I'm more than happy to seek legal advice and plan to do so, but would welcome any advice or opinions!

I split up with my ex partner in February 2019. We aren't married, no children and the only shared asset we have is our house. The property is jointly owned with no deed of trust. We live in England. Following the split, I moved in with my parents. I have continued to pay half of the mortgage throughout.

The split wasn't amicable and at one point I thought I would have to instigate legal proceedings to force a sale, but he changed his mind. We received an offer on the property in December 2019, however our buyer pulled out days before exchange in March. At that point, we discussed that we would put the house up for sale again once everything settles down.

Yesterday, he got in touch stating he had a change of heart, wanted to remain in the property and arrange a transfer of equity from me to him. Please note, he had not yet approached our mortgage provider to run through affordability checks. He will need a mortgage to continue to stay in the property.

I've been in touch with out mortgage provider today to clarify the remaining mortgage.

We purchased the house for 220k in Nov 2018. When the house was put up for sale in December 2019, we had three valuations on the property which were around the 235 - 240k. The offer we had and accepted was for 228k, but the buyer was a cash buyer. I understand that a valuation now would likely be lower. The mortgage owed on the property is 189k.

My question is that my ex is under the impression that he can remove me from the deeds and mortgage and pay me an amount that he considers reasonable. He gave a figure of around 6k.

I've requested that he gets in touch with our provider to see if the transfer of equity is even possible for affordability reasons, before even discuss the next steps.

My confusion lies in how we calculate what is owed. I was under the impression that he would be buying me out, therefore I would entitled to half of the equity left. Or is it correct that he could negotiate what I receive if this goes ahead?

Thank you so much for your advice.

Its between the two of you as regards how much he buys you out for, if anything. What deposit did you pay?

I guess the point of negotiating is that it takes two of you to agree. So you don’t have to accept an offer if it doesn’t work for you.

Factor in that you (presumably?) won’t be paying estate agent and legal fees as you would with a sale, just some solicitors and land registry fees to transfer into his name, plus no stamp duty to pay, so even if you now end up with it valued lower than it was, you shouldn’t be too out of pocket.

Where did he get the 6k figure from? If the house is worth £225-230k and the mortgage is £189k your half would be quite a bit more than that.

How much did you each put in for a deposit? That will have a bearing.

As a starting point, half the amount of mortgage paid off & half the amount of equity would be fair, assuming you both put in the same deposit.

Thanks both.

RedHelen - it was a 10% deposit of 220 and 50% each.

MarkRuffalo - there are definitely some advantages to him doing this, the ones you've listed included. I asked where he got the 6k from, but he had plucked it out of the air and hadn't done any investigation.

You would usually have 3 valuations (if you can't agree a price it is worth) and accept the median price. The bank will have to have a valuation done though so you could accept that. Then minus off the total outstanding on the mortgage and you would get half minus 50% of the legal fees. If he won't pay you your share then put it back in the market. Prices have actually risen lots of places in the last few weeks.

I did this with my VSTBEH 2019

Valuation x 3 (do it again to make sure it's up todate)

Takeaway the remaining mortgage

Split the equity in half

However what are you doing with all the furniture in the house, will be pay you a % for these?

@GlassOfProsecco

How much did you each put in for a deposit? That will have a bearing.

As a starting point, half the amount of mortgage paid off & half the amount of equity would be fair, assuming you both put in the same deposit.

I didn't want this to stand without proper challenge.

If the property is held as joint tenants the relative contributions to the deposit have no bearing whatsoever.