Husband wants to sell my pre-marriage flat to clear debts

[rdsh]

I’m just asking somewhere objective.

I have a flat I owned before I met DH. It is let out and the income is quite good. I do rely on it to a certain extent because I don’t earn much.

DH however wants to sell it: he wants to clear some debt.

I guess I’m just wondering WWYD … I want to keep it but part of that is perhaps because it benefits me rather than the whole family?

Ignoring the past, can you both sit down now and write down every expense, every debt, what is coming in, and what outgoings are must-haves? It may well be solveable without selling the flat, but you need clarity.

Did you mention a third house that is actually a cost too? Can that be sold instead?

If you were to divorce you’d have to sell the flat anyway; it would’ve in the family pot becuase the end goal is to make sure both parents house adequately and only when there’s plenty of surplus after that would you be able to argue that you had it before the marriage.

given the headaches with a rental property and tax, personally I would sell and and clear your debts.

BUT I’d do it on condition that

1. he lets you see all the finances and debts so you can actually see who and how they were created.
2. going forward you have a joint account and so you can both be clearly responsible and have visibility on spending
3. he agrees not to make any huge purchases like cars without you both discussing and greening together in future

will you have to pay capital gains on the flat? Had you worked out what it will sell for and what you will be left with?

or you could leave him and go and live in the flat!

I wouldn’t sell.

Try to minimise costs. You may have said why this is not possible but could you not manage the flat yourself? Also try to ensure that the gap between tenants is as small as possible.

I would really be trying to budget in terms of day-to-day living – you’re right that you can end up spending a huge amount and not really seeing any benefit from it. Give yourself a weekly budget for things like coffees, snacks etc. Take it out in cash and don’t go above it. Same for your DH.

I’d also be trying to work towards a position where when your children are in school or in cheaper childcare (free hours?) you are able to work more days a week. Unless one member of the family is a very high owner working two days a week is always going to limit your earning capacity as a family and life isn’t going to get cheaper. Lots of people I know see their time with very young children and high childcare costs as a bit of a loss leader, the trick is to ensure that when the kids are out of the expensive childcare you can go back to work and start earning again. I suspect that’s going to be the best way to pay the debt back.

But I also do agree with you it would be crazy to sell a flat which, unless there’s a huge backstory, should gradually increase in value and in earning potential in the future and to retain a Tesla which – however many spending advantages there are at the moment – is a luxury electric car (not just a big standard one) and which will depreciate in value.

How you handle your DH is down to you. I would suspect that now the Tesla is in the family you’re stuck with it, but I would be tempted to lay the law down and say that no more expensive cars whilst you’re in debt so at least he carries on with this particular ridiculous car rather than getting an even newer version in a few years.

You’ve both drifted into this debt and selling the flat will change nothing until you both work out where every penny is going and start to budget. Otherwise you’ll just end up in debt with no property to fall back on. Maybe look for a different letting agent if you are losing money. Suggest you sign up to MSE and the debt board to get some advice and get more organised with your spending. Good luck.

You need to understand the debt. His insanely expensive car goes first - that’s all ego. Then start to budget and slowly pay down debt. Do not sell the flat - that’s you DH getting you to sell your assets to fund his car.

I think that you need to sit down and look at your finances together and get your DH to break the debt down so you can see how the £65k has arisen. Then ask him for a plan that is fair to both of you to pay it off. I would start with the easier things - it is far easier to sell a car than a property. TBH selling the property is the last thing you should do but you do need to have a plan to sort the debt out and create a nest egg. If the comment on "different tastes" is because DH is fussy then he has to help with the meal planning and cooking.

I was going to say use the £400pm (that you won't have coming in if you sell the flat) to pay off the debt and act like you don't have it for spending but now it sounds like you won't have that soon and you need the £400 to pay your way each month as it is.

How is your husband going to afford to give you £400pm to spend on essentials for you and the children once the flat is sold and paid off the debt? I realise he wont then be servicing a debt so will have more money but you won't, you won't have £400 each month. I imagine he will then require you to get a job to earn that £400 and more to pay for the extra childcare needed because you now can't look after your kids.
Don't let him make this your problem.

What happens when his head is turned by another car? If he's like someone I've known, he won't be able to help himself and will allow the family to get into more and more debt because I need xy&z shiny shiny. "I won't get a promotion if I don't look the part" and it's a "great deal" that "saves money" yeah right!

If you do sell the flat, your husband will be better off, you will be worse off. You will have lost your asset, you won't have the £400 income. You have separate finances and no guarantee he will replace that monthly income so what will you do then?
If he doesn't want to help sort the issue by swapping his car for example, why should you give up your asset and income?
You probably need external help to unravel your finances because you can't seem to communicate effectively about them. Try StepChange.

This thread is staggering to me. I always assume people with Tesla's must be incredibly wealthy. DH and I have mortgage paid of and decent savings etc and both just drive little second hand Kias

It would be bonkers to sell a flat to fund a very expensive depreciating asset.

I don't think you want to know about the extents of debts, @rdsh .

What likely happened is that some debts were on 0% credit cards, and now your husband can't get a new balance transfer and feels uncomfortable as there is no spare cash to clear them or even to keep up with the interest rates. Being the man responsible for finances in the family while you were playing 'don't have interest in finances' role, he doesn't want to admit that there are only two options:

• sell your flat
• consider much reduced lifestyle when you have to live like someone on a low income, while on paper having Tesla on the drive and good income.

It is one thing to know that there are some debts, and the other thing is to look at them and realise that it would take 3-4 years of reduced lifestyle to clear them, not just a couple of tough months and minimising.

In practical terms it helps to have a shared account for day-to-day spendings and put the agreed money there weekly. It helps to realise how quickly the money goes with all these parking fees, hot chocolate here and there for kids - by the way can totally relate to this.

So you brought two properties into the marriage, but he thinks you are the problem?

If I were to be very cynical - I'd suggest that he thought he was onto a very good thing wealth-wise when you & he married. bUT he's diappointed in not havign the life of Riley.

Oh dear, those darn DC he agreed to have - they cost money, and he can't spend it all on him.

Your DH sounds really dysfunctional over money. Was he raised in relative poverty and is now wanting to be upwardly mobile? If he were used to wealth - or at least affluence - he would know that you never sell a capital asset to pay of debts incurred by daily life. And you'd lose quite a lot in capital gains tax anyway ...

Do not sell no matter what.

Firstly, get control of the finances and relationship because it’s not worth sorting the former out unless both of you learn from it and really change your ways. Or you will end up back in the same position.

We had a debt alot smaller than yours which we are now at the end of paying off.

The thing is, if the debt is not ‘frozen’ somehow, it will continue to accrue interest and rise. If using flat rental income of 4k / year to pay off debt and dh doesn’t contribute it would take at least (very rough estimate!) 15 years to pay off the debt. Even if dh matches that 4k / year to repay a total 8k a year, it will take at least 8 years to pay. And that’s if you could get whoever you are repaying to agree to a repayment plan of those amounts.
I would sell one of the properties and pay the lot off, I wouldn’t want that hanging over me and potentially increasing.

If he sees selling your flat as the answer to the debt, and if you have contributed to the debt, then the finances are as much yours as his. There’s no point in discussing a debt you know nothing about. Step up and take some responsibility

In general, selling a property (which is not biting you/is not a burden to you) is a bad idea. Period. Moreover, selling a property that is bringing in "good income" is an even worse idea. Aim (and learn) to clear the debt gradually. Killing the goose that lays the golden eggs -- is not a great idea.

Do not sell your flat to prop up your marriage. It's your only substantial asset.
I say...Its time for him to prove his worth.
Get rid of him and move back there

…he wants to sell your flat to pay for his car?

you both need to live within your combined means. By not sharing finances and financial decision you are living to different standards. I don’t think that’s what marriage is for?

But you haven't addressed where you would live. It sounds as though your dh is the one overspending if it's him taking out the credit and he will drag you down with him. Tbh it sounds as though that's what's happening.

absolutely not, sell the flat and put it into a pension. Your pension will have suffered due to maternity and now only working two days per week, so absolutely not

Better to use the rental income to clear the debt

My friend did this to pay off the mortgage on the house they owned together.

Weeks later he left her for another woman.

Tread with caution.

Op as with previous posters, before you decide to sell the flat, you need to get your finances in order and have the hard discussions and agree what you can cut back to live within the income not including the flat.

Use the flat income to service the debt, tax and associated running costs.

Selling the flat should be the very last resort as remember, as your children get older, childcare costs will decrease and your potential to earn more will increase.

I also have a flat that is legally mine as purchased prior to marriage. Throughout the years it would have been easy to sell to get us through a tough period but we didn’t as we both agree that whilst legally it is mine, we are keeping it for our children as they will need all the help they can get to get onto the property market.

May be try to position it like that with your dh and that might help to rethink the asset.

It sounds like the debt has been accrued not because you've made a big purchase or had a disaster which has cost a lot to fix but just because day-to-day you are living beyond your means.

You say that your income is £1600 a month (which absolutely does not put you anywhere close to a "bracket which means extra income is swallowed by tax," btw) and your outgoings are £1800...well, you need to reduce them. It's no good saying they are "fixed" when you don't earn enough to cover them. If it's mortgage payments, you need to move house.

Otherwise, you can sell the flat, pay off the debt, and in a few years you'll be even more in debt (and £400 a month worse off) with no flat to sell.

I wonder if you sell the flat, he will quickly upgrade his car !
He sounds irresponsible spending large sums of money without consulting you.
He could have got a cheaper Ecar !
So now you are fretting about an ice cream at Easter,
I think you need to say we need to have a joint look at all our budget, our receipts & expenses & work out how to get a grip together.
That selling the flat would only be a temporary bandaid if the spending isn't reduced. & you won't sell it without full access to the accounts

BTW, I don't think you should sell it

Could you make a concerted to use all the rent each month to pay off the debt and rein in spending for a while? I really wouldnt sell. Im in a similar position but put the rent into our joint account. All our income became joint when we moved i together, got married, had kids.

Not to be flippant @rdsh, but there’s no point meal planning and remembering to bring the blasted wipes when you head out if your DH comes home with another £20k loan for a car that he hasn’t discussed with you. It does not sound like you have the household income to support his obsession with cars and I think you’re right to say he may be misplacing his frustration with himself onto you. Because the Tesla isn’t for the good of the family and doesn’t save you all money - if he wanted an electric car he could get on salary sacrifice and charge at work, was a Tesla (ie the most expensive electric car you can buy) really the only option? I doubt it.

I understand you feel guilty because you’re not bringing in a large wage, but you are contributing because you are saving the household childcare costs.

You say you’re capable of standing up for yourself, but I’m not seeing that. You’re talking about how much you will spend taking the kids out over Easter but your DH has been responsible for two expensive car purchases in recent years! If you had tea and cake at a National Trust site every week for a year, you would still only spend £1.5k. I think you need to right size your guilt about the debt that’s been accumulated.

Anyway, don’t sell the flat.