Ex took £30,000 loan out for home improvements and spent the lot

[matilda1077]

In the process of getting away from domestic abuse.

We have 2 DDs and a mortgage.

A few years ago, ex partner took a £30,000 loan from our mortgage provider under the agreement that it was for 'home improvements' ie to build an extension. He spent the lot, not on the extension - he won't tell me where it went or just makes up stupid excuses.

As the loan was taken out in both of our names, am I right in thinking he has violated terms of the loan? Does anyone know where I stand from a legal viewpoint - when the property sells should I get more of the equity with a view that he already had £30k and spent it on himself, so that should be his lot?

I plan on going into rented to get away from the abuse, but at the same time I want the property to be financial security for my little girls futures. In an ideal world, I would keep it as an investment property, rent it out. When the girls turn 18, sell the place up and give them both half the proceeds to go and get a home of their own.

He says we should sell it and split the proceeds equally and cut all ties with it, but we will both end up in rented and have no future security or assets to hand down to the girls. I don't care about the money from this place, I just want it for them. And he has already lost us £30,000.

I don't think it's fair that it is split equally. I also suggested buying him out, but again, should the value of equity be X amount minus the £30,000 he took and spent?

Any advice would be much appreciated

I think the 30k will be seen as joint as he took it out against the house? They won't be interested in who actually spent the money on what.

Unless you are married, then the property would have to be sold and any equity split equally. The £30k is a red herring - you knew it was being applied for, you signed the application, you knew the money was paid out and knew it wasn’t being spent on the house.

If you are married, the court can take this into account and adjust the amount, although it might not be worth fighting - the £30,000 would soon be swallowed up in legal fees.

If you aren’t married, there is nothing you can do. Legally you both violated the terms of the loan and proving he spent it on himself and not on ‘the family’ is likely to be impossible. You could try and argue it in court but I honestly don’t think you would succeed and again, the legal fees would be astronomical (and you would end up paying his costs if you lost).

I’m sorry, I know that’s not what you wanted to hear. I think the only way the £30,000 is coming off his share is if he volunteers to give it to you and from your description of him, I don’t think that is likely.

The £30k was added to the mortgage and nothing can change that - to be honest, the Bank won't really care how it was spent, they're only bothered about getting it repaid. So the equity in your house has reduced by £30k as a result. Legally you're going to struggle here.
And you'll need to sell the house and cut ties. I think it's a bad idea to do anything else in this situation.

Thank you for the replies, I thought this might be the case but just wondered if anyone had experienced something like this.

@Soontobe60 I actually didn't know it wasn't spent on the house until it was gone. He told me he had used it on architect fees and materials but since leaving it has come to light that this was a lie and it was spent on his own debts that I also had no clue he was in. But thank you.

You need to get to the bottom of his money issues as currently they're also yours.