Splitting with partner - who owns the house?
Discussion
I bought a house about 6 years ago in my name, I paid the mortgage and she lived under the same roof as me for about 4 years. She didn't pay any mortgage costs but did put some money towards the renovations. Being a generous person I also gave her some money per month to give up her long distance job.
Last year we decided to purchase a house together (joint names and joint mortgage) and put down a deposit of £104,000 from the sale of the previous house having overpaid the mortgage substantially. We made around £32,000 in profit from the renovations made since the original purchase price to sale price. Still I am paying the mortgage and she is not. We do not have children.
Now unfortunately we are looking at splitting up - she wants £52,000 - is this allowed? Am I screwed?
Last year we decided to purchase a house together (joint names and joint mortgage) and put down a deposit of £104,000 from the sale of the previous house having overpaid the mortgage substantially. We made around £32,000 in profit from the renovations made since the original purchase price to sale price. Still I am paying the mortgage and she is not. We do not have children.
Now unfortunately we are looking at splitting up - she wants £52,000 - is this allowed? Am I screwed?
jinkster said:
I bought a house about 6 years ago in my name, I paid the mortgage and she lived under the same roof as me for about 4 years. She didn't pay any mortgage costs but did put some money towards the renovations. Being a generous person I also gave her some money per month to give up her long distance job.
Last year we decided to purchase a house together (joint names and joint mortgage) and put down a deposit of £104,000 from the sale of the previous house having overpaid the mortgage substantially. We made around £32,000 in profit from the renovations made since the original purchase price to sale price. Still I am paying the mortgage and she is not. We do not have children.
Now unfortunately we are looking at splitting up - she wants £52,000 - is this allowed? Am I screwed?
I expect so unless you had something (declaration of trust for example) that showed you put in the full deposit.Last year we decided to purchase a house together (joint names and joint mortgage) and put down a deposit of £104,000 from the sale of the previous house having overpaid the mortgage substantially. We made around £32,000 in profit from the renovations made since the original purchase price to sale price. Still I am paying the mortgage and she is not. We do not have children.
Now unfortunately we are looking at splitting up - she wants £52,000 - is this allowed? Am I screwed?
The 'equitable thing' would be to work out what she has put in re renovations and add on a sum for the price increase, it what she's put in has appreciated as has 'your' share.
I'm inferring from your post that this wouldn't be anywhere near £52K and she is going for the half because of the 'joint' aspect on the new property from a year ago (smacks of slightly calculating doesn't it?)
You need to do some research as a minimum and CAB and probably proper legal advice shortly thereafter, best of luck to an amicable and fair settlement.
I'm inferring from your post that this wouldn't be anywhere near £52K and she is going for the half because of the 'joint' aspect on the new property from a year ago (smacks of slightly calculating doesn't it?)
You need to do some research as a minimum and CAB and probably proper legal advice shortly thereafter, best of luck to an amicable and fair settlement.
When you buy a house you can stipulate what % the two parties put in. Before I married my wife (and children etc) we put down the split of monies provided as 60:40.
Did you detail anything on there?
if not, I would start putting together every bit of financial *proof* as to where the monies came in, where they went and what sort of split would be FAIR.
Did you detail anything on there?
if not, I would start putting together every bit of financial *proof* as to where the monies came in, where they went and what sort of split would be FAIR.
I found this link with a possibly crucial bit in the section below about splitting ownership at different ratios
https://www.moneyadviceservice.org.uk/en/articles/...
Your solicitor should have given you advice about the best way to own your home jointly at the time you bought it. The two options for this are as:
•Joint tenants (called joint owners with a survivorship destination in Scotland) – this is where you own the property equally between you. When one of you dies, the other inherits their share, no matter what’s said in their will or if they have a will at all.
•Tenants in common (called joint owners in Scotland) – this is where you each own a share in the property. You can split ownership equally between you (50:50) or you can decide that one of you will own more than the other. Your share of the property will pass to whoever you leave it to in your will.
https://www.moneyadviceservice.org.uk/en/articles/...
Your solicitor should have given you advice about the best way to own your home jointly at the time you bought it. The two options for this are as:
•Joint tenants (called joint owners with a survivorship destination in Scotland) – this is where you own the property equally between you. When one of you dies, the other inherits their share, no matter what’s said in their will or if they have a will at all.
•Tenants in common (called joint owners in Scotland) – this is where you each own a share in the property. You can split ownership equally between you (50:50) or you can decide that one of you will own more than the other. Your share of the property will pass to whoever you leave it to in your will.
If you own it as joint tenants (i.e. property passes automatically to the survivor on the death of a co-owner), the default position is 50/50 unless you enter into a declaration of trust that recites that it's something other than 50/50. If you didn't do that at the time of purchase, you're going to be on the back foot right from the outset, no matter who has in practice paid what.
If you own as tenants in common (i.e. each party can dispose of their half as they see fit and to whomever they choose), you will have had to indicate in what proportion it is held. I assume that it isn't held in this way since you don't mention anything of that sort.
The court does have a discretion to deviate from the 50/50 position on a joint tenancy but it is going to be for you to persuade the court that it would be just and equitable to do so if you contend for a different ratio.
You need to take some specialist advice on this.
If you own as tenants in common (i.e. each party can dispose of their half as they see fit and to whomever they choose), you will have had to indicate in what proportion it is held. I assume that it isn't held in this way since you don't mention anything of that sort.
The court does have a discretion to deviate from the 50/50 position on a joint tenancy but it is going to be for you to persuade the court that it would be just and equitable to do so if you contend for a different ratio.
You need to take some specialist advice on this.
Lurking Lawyer said:
If you own it as joint tenants (i.e. property passes automatically to the survivor on the death of a co-owner), the default position is 50/50 unless you enter into a declaration of trust that recites that it's something other than 50/50. If you didn't do that at the time of purchase, you're going to be on the back foot right from the outset, no matter who has in practice paid what.
If you own as tenants in common (i.e. each party can dispose of their half as they see fit and to whomever they choose), you will have had to indicate in what proportion it is held. I assume that it isn't held in this way since you don't mention anything of that sort.
The court does have a discretion to deviate from the 50/50 position on a joint tenancy but it is going to be for you to persuade the court that it would be just and equitable to do so if you contend for a different ratio.
You need to take some specialist advice on this.
OP this is mostly correct. Firstly you need to check the TR1 which will be the starting point. Box 10 should contain information about any declaration of trust.If you own as tenants in common (i.e. each party can dispose of their half as they see fit and to whomever they choose), you will have had to indicate in what proportion it is held. I assume that it isn't held in this way since you don't mention anything of that sort.
The court does have a discretion to deviate from the 50/50 position on a joint tenancy but it is going to be for you to persuade the court that it would be just and equitable to do so if you contend for a different ratio.
You need to take some specialist advice on this.
If there is no declaration of trust and the property is held as beneficial joint tenants, the presumption is that you are each beneficially entitled to 50pc of the net proceeds of any sale. That presumption is rebuttable. Where I disagree with LL is the 'just and equitable' part. There is no such test.
LL is right that the court has the power to depart from the legal ownership position but you would have to satisfy the court that the two of you had a common intention that your beneficial interest differs from the legal position (ie that you had a common intention that it would be held other than 50/50). That common intention can be express (ie by agreement) or implied (ie be demonstrated by your combined actions). The issue you have is that you have recently purchased the property together. If our assumptions are right that it was purchased as joint tenants with no declaration of trust, the obvious question if you are asserting that you had some other common intention is why wasn't that intention reflected at the time of purchase.
This is a complicated area of law and you need to take some specialist advice.
She can ask for whatever she likes, whether you both (or ultimately a court) agrees is another matter. If you're joint tenants then you both jointly own the whole property together, and no individual share is defined. If you're tenants in common, then by default you each own 50%, unless there's an agreement that states differently (and if there was, then you'd know about it already).
Ideally, you want to come up with an amount that you are both happy with, and agree it without going legal on each other, or you'll just be haemorrhaging money in legal fees.
There's lots of factors to consider - where did the 52k of equity from the previous house come from? Original deposit, renovation/improvements, mortgage repayments, inflation (probably a bit of all of those)? When exactly did she give up her job, and does she have any other income, other than the pocket money that comes from you?
I mean if she contributed £25k of her own money to the renovation, and got another, more local job for lower wages, then it's possible that she'd made £50k worth of contribution, even if it wasn't directly towards the mortgage repayments. On the other hand, if she only put in a couple of thousand towards the renovations and hasn't worked for years, it puts you in a stronger position.
Ideally, you want to come up with an amount that you are both happy with, and agree it without going legal on each other, or you'll just be haemorrhaging money in legal fees.
There's lots of factors to consider - where did the 52k of equity from the previous house come from? Original deposit, renovation/improvements, mortgage repayments, inflation (probably a bit of all of those)? When exactly did she give up her job, and does she have any other income, other than the pocket money that comes from you?
I mean if she contributed £25k of her own money to the renovation, and got another, more local job for lower wages, then it's possible that she'd made £50k worth of contribution, even if it wasn't directly towards the mortgage repayments. On the other hand, if she only put in a couple of thousand towards the renovations and hasn't worked for years, it puts you in a stronger position.
jinkster said:
I bought a house about 6 years ago in my name, I paid the mortgage and she lived under the same roof as me for about 4 years. She didn't pay any mortgage costs but did put some money towards the renovations. Being a generous person I also gave her some money per month to give up her long distance job.
Last year we decided to purchase a house together (joint names and joint mortgage) and put down a deposit of £104,000 from the sale of the previous house having overpaid the mortgage substantially. We made around £32,000 in profit from the renovations made since the original purchase price to sale price. Still I am paying the mortgage and she is not. We do not have children.
Now unfortunately we are looking at splitting up - she wants £52,000 - is this allowed? Am I screwed?
A mate of mine bought a house with his girlfriend some years back. Joint names, joint mortgage - similar to you.Last year we decided to purchase a house together (joint names and joint mortgage) and put down a deposit of £104,000 from the sale of the previous house having overpaid the mortgage substantially. We made around £32,000 in profit from the renovations made since the original purchase price to sale price. Still I am paying the mortgage and she is not. We do not have children.
Now unfortunately we are looking at splitting up - she wants £52,000 - is this allowed? Am I screwed?
He laid out all of the deposit, paid all of the mortgage payments when they lived there and all of the moving costs. She worked, but earned nowhere near enough to contribute anything.
6 months after purchase, they split up. She got exactly 50% of the equity. Nothing he could do....
Robertj21a said:
It's highly likely to end up 50/50 anyway, even after a lot of hassle/arguing/solicitor fees etc. I think I'd just agree to the £52k and be relieved that I got out before it cost me even more a few years down the line (children, maintenance etc)
Agree with that. You might talk it down to £40k, but at the cost of £5k in lawyers' fees and a stomach ulcer. Get it done, get it done quick.
Where did the original deposit for the first house come from? From the first post, i'd assume this was £72k deposit, then the £32k profit that you mentioned, making up the £104k deposit for house 2?
Without a declaration of trust then my understanding was the same as others in that it's a 50/50 share of the current ownership.
Can you afford to keep the house and pay her the £52k? If so that might be best as at least you'll keep the asset and avoid spending many £k on moving house.
However if it were me, i'd be inclined to offer her the full £32k profit from the renovations, and make it clear that the other £72k came from your own finances, and you aren't inclined to give her anything from before you met? You need to come up with a decent case to argue, something that she might think a court would agree with.
Without a declaration of trust then my understanding was the same as others in that it's a 50/50 share of the current ownership.
Can you afford to keep the house and pay her the £52k? If so that might be best as at least you'll keep the asset and avoid spending many £k on moving house.
However if it were me, i'd be inclined to offer her the full £32k profit from the renovations, and make it clear that the other £72k came from your own finances, and you aren't inclined to give her anything from before you met? You need to come up with a decent case to argue, something that she might think a court would agree with.
Andehh said:
When you buy a house you can stipulate what % the two parties put in. Before I married my wife (and children etc) we put down the split of monies provided as 60:40.
Did you detail anything on there?
if not, I would start putting together every bit of financial *proof* as to where the monies came in, where they went and what sort of split would be FAIR.
Very much this. It cost me about £200 with a solicitor to draw up an agreement but money well spent if we ever split up. I put down £60k for our house and she put in £10k. The house is in both our names and she pays her way (works out about 55% from me towards the bills and mortgage and 45% her but near as damn it an even contribution in my mind.) if the worst happens, we sell up, she gets her stake back, I get mine and then any profit after the sale gets split 50:50. Did you detail anything on there?
if not, I would start putting together every bit of financial *proof* as to where the monies came in, where they went and what sort of split would be FAIR.
toon10 said:
Andehh said:
When you buy a house you can stipulate what % the two parties put in. Before I married my wife (and children etc) we put down the split of monies provided as 60:40.
Did you detail anything on there?
if not, I would start putting together every bit of financial *proof* as to where the monies came in, where they went and what sort of split would be FAIR.
Very much this. It cost me about £200 with a solicitor to draw up an agreement but money well spent if we ever split up. I put down £60k for our house and she put in £10k. The house is in both our names and she pays her way (works out about 55% from me towards the bills and mortgage and 45% her but near as damn it an even contribution in my mind.) if the worst happens, we sell up, she gets her stake back, I get mine and then any profit after the sale gets split 50:50. Did you detail anything on there?
if not, I would start putting together every bit of financial *proof* as to where the monies came in, where they went and what sort of split would be FAIR.
superkartracer said:
Or maybe marry someone you trust?
I wonder how many people go into marriage expecting, wanting or thinking they will ever get divorced. I suspect none and yet I've never seen a poor divorce lawyer. It does happen. It's a bit of a sweeping statement. Plan for the worst and hope for the best and all that.
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