Ex wants my mum's gift of 20k included in equity split

[DangleDonkey]

Hi all,

Partner and I (not married / 1 child) split in November last year and are selling our house. It was a wreck when we got it and we spent a lot of money on doing it up.

A rough summary is:
287.5k - bought the house for this in 2022
Made up of 80k deposit from previous property and 207k mortgage.

Spent 40k on the renovation plus stuff for the house (this extends from a rewire and carpets to storage costs and rent for where we lived during the renovation to a dishwasher and cushions and nice things for the house). We don't have an itemised list for this and it'd be almost impossible to do that nearly 3 years on).

20k of the above was from our previous house sale which we kept back, 20k was a gift from my mum. My mum sees this as inheritance that is more useful to give to us now (my sister also got 20k, which went into her ISA), rather than when she dies. My mum is 71 and in good health - I understand a gift of this size can have inheritance tax applied if she were to pass within 7 years of the gift.

When our sale goes through and we've paid our fees and 198k ish of mortgage, I'd like to take out that 20k as mine then split the rest of the equity as 79/ 21, which is stated in our deed of trust (with my share as 79%).

Ex is sore about this split, despite signing the deed of trust at the time. He does seem to understand that it's legally binding though as he signed it freely and it does accurately represent the share of the deposit we each put in.

He wants this 20k from my mum to be included in the equity split, ie he would get 21% of it.

Is this inevitable and I just need to accept it as we never had a document drawn up to ringfence that money as mine?

Or as we're not married and there's bank statements showing the gift, and my mum would attest it was for me not for us, can it be separated out?

Thank you in advance

Just say no if he disagrees he can take you to court, from what you say he has no entitlment.

He's got no right to it, your mum gave it to you and you're not married. Tell him to fuck off.

He's mentioned stalling the sale if he doesn't get what he thinks is fair, and as he's not got an onward purchase, just me, that's making me very nervous

How was the labour, time etc on the renovation split? If you’ve done half each and he’s been really involved then morally I would think splitting the 20k would be fair.
If you’ve done significantly more than half the work as well then I reckon that morally the 20k should remain yours.

so the money has effectively disappeared into the house equity hasn’t it? And the deed of trust sets out what the money is. Unless the deposit was specifically carvied out I would have thought it is clearly become part of the equity in the house and the split applied as it

Can you not get a mortgage to buy him out then the only "sale" he will be stalling would be to you and you can wait him out?

Or could your mom write a personal statement stating this was a gift to you personally not a joint gift?

But the money was used for the asset of the house - and the deed says he’s entitled to that split

but anyway OP - there will be a very clear legal
answer - I think it will be my answer but it’s not my area.

i would suggest asking the lawyer who drafted the deed. I’m suprised it wasn’t thought about at the time to be honest

I'm not a lawyer but I think if the deed of trust is 79/21 ownership then it isn't really relevant who paid what. Unless you want to go to court which would cost more than £4k.

But surely the £20k was considered when drawing up the 79/21 split?

He did some of the labouring work in the renovation but I'd just given birth so was looking after a month old baby, and she was 8 months old when we finished.

The lawyer who drafted the deed of trust didn't offer us any legal advice and we didn't think to ask for it. She was a cheap lawyer and we got a cheap package, with consequences of that....

The money from my mum came several months after the purchase went through - we already had 20k from the sale to get cracking on the reno. So I just never considered really that it needed to be treated legally. Daft really, as I was really careful in calculating the percentages for the deed of trust.

It's not a huge amount of money and I'm not prepared to go to court for it. It's just the audacity of it that I'm struggling to accept

He's right. The 79/21 split is in your favour as bigger deposit includes your mums £20k. You'd be double counting to take out the 20k and still get 79/21

No - it came a few months after completion and so wasn't considered in the deed of trust split

Think I'd just include the 20k in the split. Is it really worth the hassle and possible stalling and court fees, for the £4,200 you are fighting over?

The 20k from my mum was separate to the deed of trust. It's not part of the deposit - it was cash we spent on the renovation.

If the deed or trust says 71/21% split of equity and nothing else was stipulated then it's all the equity that's included, even the £20k you put in from your mum.

I don't want to stay in the house and couldn't afford the upkeep etc.

I think my mum would do this if it made a difference to how that 20k is treated.

But that cash was spent on the house and now forms part of the total equity? And the deed of trust covers how your entire equity is split?

True - I understand that logic

That won't matter. Even if she gave it to you, you've chosen to put it into a joint asset.

Would your mum need to say it was a loan not a gift? Because then you are paying people you owe out of the equity first before the division. Otherwise I would expect it to make up the equity and be fair to be divided.

Is this guy joking?! He’s not your husband - he can’t take your money!!!

So there’s around £100k of equity to split? You want £20k plus 79% of the remaining £80k (£63k) - £83k in total and he gets £17k. He wants £21k and for you to get £79k.

It’s £4k difference. Negotiate with him. Not worth going to court or risking your sale falling through for that amount.

Bit more than that - house sale is 365k and remaining mortgage is 198k approximately so about 160k of equity once fees have been paid

I’m interested in why it is 79/21 split?

It’s really hard isn’t it and I see why you feel that is your entitlement but I agree that you invested that into the Reno and now you will sell it and get 79% (£15800)

I mean this is my feeling. He's sore about the equity split but realises that as there was no misrepresentation or fraud, and he signed it of his own free will, there's not a lot he can do about it.

He arrived at this house with 21% of the deposit as I allowed him to accrue equity in the previous house, even though it was my house with only my name on the mortgage. I don't regret that, it was fair at the time and I wanted him to start building some financial security. But it just really bites now that he already has more than legally he was entitled to, and is still going after 4k of my mum's money, her literal life savings. When she babysits for us all the time and has offered so much support