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Joshua
Joshua, Lawyer
Category: Law
Satisfied Customers: 26069
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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I have a joint mortgage with an ex partner who walked out in

Resolved Question:

I have a joint mortgage with an ex partner who walked out in May 2011. The mortgage payments have always been taken from my bank account. I have continued to live in the house since she left and pay the mortgage. The house was purchased for £116,500 in July 2006. It is now valued at £111,000. I have asked her to fill in a form to remove her from the mortgage. She has found out that I have become engaged and has now said she won't sign the form and will be seeking legal advice. Can you advise me where I stand
Submitted: 3 years ago.
Category: Law
Expert:  Joshua replied 3 years ago.

Joshua :

Hello and thank you for your question. I will be very pleased to assist you. I'm a practicing lawyer in England with over 10 years experience.

Joshua :

May I confirm for the avoidance of any doubt that you were not married nor had any children together please?

Customer:

I was not married and have no children.

Joshua :

Thank you. May I ask if you entered into any form of declaration of trust in relation to the property when you purchased it or any other form of agreement regarding ownership please? This would have either been a formal agreement or an exchange of written correspondence as to your respective shares usually

Joshua :

Did you contribute towards the property equally in terms of deposit or mortgage payments before she left?

Customer:

We didn't sign any sort of agreement regarding ownership. We took out a joint loan for the deposit which was paid off. When we needed £2000 to re-mortgage after the initial period we borrowed it from my parents and it has never been paid back to them. There was nothing official written down. The mortgage payments always came out of my bank account. She contributed towards food etc and some bills but I paid the majority of bills.

Joshua :

Sorry for the short delay...

Joshua :

Is there any evidence that the loan from your parents was a loan as opposed to a gift from them?

Joshua :

Is the mortgage a capital repayment mortgage or an interest only mortgage?

Joshua :

Did you share any joint accounts together?

Customer:

Nothing was written down. When she left, my parents said if she walked away without any trouble they would forget her share of the loan but this was verbal. The mortgage is a capital repayment mortgage. We had one joint account used for savings and bills. It is closed.

Joshua :

Thanks. How much equity would you estimate was in the property a) at the point she left and b) now?

Customer:

At the time she left the house was in negative equity. I looked into getting her off the mortgage but the difference between what the house was worth and what we paid for it was too great for me to pay and I didn't want to throw more money away. Now that the house is worth the same as what the mortgage is, I want to remove her from the mortgage and move on.

Joshua :

Thanks so there is at present little or no equity in the property - do I understand this correctly?

Customer:

Yes the amount owed on the mortgage is about £1000 more than what I have had a valuation for which isn't to say it would sold for the valuation amount.

Joshua :

Thanks. Finally, does your ex partner know this?

Customer:

I haven't told her but don't know if she has been in contact with the mortgage company. A bigger house across the road was sold last year for £112,000.

Joshua :

Thanks. It seems to me to be pertinent to ensure she is aware that the house has little or no equity. As such the property is not an asset but rather her continued joint ownership of the property constitutes principally a liability as she remains jointly liable with you to the lender. She cannot hope to make a claim against something which is not an asset.

Joshua :

As a consequence determining your respective shares in the property is academic as there is little or no equitable share to determine from what you say.

Joshua :

Accordingly your approach is likely to be as follows. The first step is to ensure so far as you have not already done so that you are able to obtain mortgage finance in your sole name. Assuming this is possible you may consider advising your ex partner that there is no equity in the property and that you require her either to take a transfer of the property into her sole name or to authorise the transfer of the property to you. If necessary you can advise that you will seek a court order under the Trusts of Land and Appointment of Trustees Act however you would prefer not to do this because there will be costs implications to both of you in so doing and the property has no equity and represents no value to either of you.

Joshua :

If a lender will not authorise a mortgage in your sole name then you will not be able to take her name of the existing mortgage even if you are in agreement and the only way to proceed other than the status quo would be to sell the property. However on the basis that you can obtain mortgage lending in your sole name then if she will not agree then you can propose mediation and failing this can make an application to the court for an order for a transfer of the property under TLATA. However this is likely to cost between £1500-3000 in fees which cannot necessarily be recovered from your ex partner hence why I suggest this should be a last resort

Joshua :

Is there anything above I can clarify for you?

Customer:

Sorry for the delay, my Mum is discussing it with me.

Customer:

I have applied for a decision in principle from a financial adviser and I am able to get a mortgage in my name and my fiancee. I have advised my ex partner that there is no equity in the property.

Customer:

Is the fact that I have been offered a mortgage with my fiancee an issue as you have mentioned 'sole name'.

Joshua :

May I be clear, is this your new fiancee?

Customer:

yes, we have been engaged 6 months and I think this is why she is dragging her heels

Joshua :

On that basis you can consider proceeding in the above manner. I cannot see any financial point in your ex partner refusing to divest herself of what is essentially a liability. Unfortunately when it comes to relationships past and present it is not just about financial issues but one would hope that she would have regard to the financial benefits to herself in agreeing.

Joshua :

If she will not then you can consider mediation or finally an application to the county court but one would hope certainly the latter can be avoided.

Joshua :

Is there anything else I can help you with?

Customer:

For the 5 years I was living with my ex partner she paid for some of the food and a monthly bill, however I paid for the majority of bills and the mortgage came out of my account which I paid for fully. If this were to go to court, what is the chance she would be entitled to anything (even though it isn't an asset)? My financial adviser from the estate agent said that she is liable for half of the mortgage fees from when she moved out 3 years ago. Is this true? If so, would she be liable for half the fees for the 5 years we lived together if she wanted to pursue this?

Joshua :

There is nothing for her to claim if the matter went to court from what you say. She cannot claim anything from an asset in which there is no value. It may be that you could seek to claim half the mortgage payments whilst you were living together but this may be difficult if you paid them in practice as she could argue this was the agreement between you. It would be for you to show that this was not your agreement which may be difficult. In respect of the period since she moved out regrettably your FA is not correct in what he has told you. If you have had sole use of the property since she left, then you are liable to pay an occupational rent which is typically judged to be half the mortgage (i.e. your ex's share of the mortgage payments). The idea behind this is to account for your sole enjoyment of the property and your ex's lack of use of the same.

Customer:

Are you saying that I will have to pay her half of the mortgage from when she left back to her on top of 100% of the mortgage that I have paid?

Joshua :

There is no question of you having to pay anything back to her. You have already paid from what you say her share of the mortgage. She is not entitled to make a claim to these payments in any way. As above it may be possible to attempt a claim for her share of mortgage payments during the time you were together but the evidence of all payments coming from you will be unhelpful as it is evidence of implied agreement between you that this was the arrangement. If you can show that it was agreed that you would be equally liable for mortgage payments however this could be possible. In the absence of such evidence the costs of pursuing a claim may outweigh the benefits for both of you. Based on what you say I cannot see she has any substantive claim against you at all. You may against her as above but such a claim could be difficult.

Joshua :

Does the above answer all your questions or is there anything I can clarify or help with any further?

Customer:

And if she were to not sign the house over now I would be in my right to seek a court order under the TLATA to do this, although it would incur costs of up to £3000?

Joshua :

You can if all other attempts fail certainly.

Customer:

With all this in mind, if she dragged it out until there was equity in the property is she then entitled to half the profit after costs?

Joshua :

She cannot make a claim in respect of the benefit of any mortgage payments you have made since she left as there would be no presumption that such payments were intended to be in any way gifts to her after she left. Accordingly I do not think this would be something she could consider.

Customer:

So if the house gains equity then she is not entitled to any of it as it has gone up in value since she left?

Joshua :

She would not be entitled to any equity arising from your mortgage repayments. She could potentially seek a claim against equity arising from natural increases in market value but on the basis you resolve this matter within the next 2-12 months having taken into account your mortgage payments barring monumental increases in the property market there is unlikely to be any significant equity against which to claim.

Customer:

Do I need to be worried her sister has an LPC and her sisters partner has sat his bar exam - I am unaware if he has passed it?

Joshua :

Passing an LPC is a little bit like a learner driver. You don't know very much that is practically useful. Much the same is true of the bar until you get a bit of experience behind you. In any event all the qualifications in the world do not change the legal position. It may equally be that they will counsel her to cooperate. If you decide to proceed to court you will need to retain an experienced family solicitor who specialises in TLATA claims to assist you in any event

Customer:

Thank you very much for your help. It has been very useful.

Joshua :

A pleasure. If I can assist any further as the situation develops please do no hesitate to let me know.

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