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Ask Clare Your Own Question
Clare
Clare, Solicitor
Category: Property Law
Satisfied Customers: 34585
Experience:  I have been a solicitor in High Street Practise since 1985 with a wide general experience.
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A and bought a house on mortgage and were registered as Joint

Customer Question

A and B bought a house on mortgage and were registered as Joint Tenants. They are not married but had renewed a previous relationship. They have now separated. A has left the property, B has remained. A wants B to pay her half of the current equity. B is happy to do this if A then relinquishes any further financial interests in the property. That is, A cannot make any future financial demands arising from ownership of the property. B is unable to sell or remortgage the property. Can B issue a Severance of Joint Tenancy and specify that A has a 1% share and B a 99% share? Or a Trust Deed to the same effect?
Submitted: 2 years ago.
Category: Property Law
Expert:  Clare replied 2 years ago.
Hi
Thank you for your question
Mt name is Clare
I shall do my best to help you but I need some further information first.
Is A willing to remain on the mortgage indefinitely?
Clare
Customer: replied 2 years ago.
The short answer is Yes. A realises that she will still be registered as co-mortgage.
Expert:  Clare replied 2 years ago.
Hi
Then the way for this to be dealt with is via a Declaration of Trust confirming that A and B hold the property on Trust for B alone.
It would be advisable for a long stop date to be included (say five years) after which the property will be sold if A cannot be discharged from the mortgage
I hope that this is of assistance - please ask if you need further details
Clare
Customer: replied 2 years ago.
Thank you. Is there a standard format for a Declaration of Trust, or must it be drawn up by a solicitor?
Expert:  Clare replied 2 years ago.
Hi
If you wish to be sure that your ex cannot challenge it in future then having it drafted by a solicitor would be wise
Clare
Clare and other Property Law Specialists are ready to help you
Customer: replied 2 years ago.

Hi again

I have approached 2 solicitors to draft this document. Both have advised me that it will not stand in law!

What do you advise?

Expert:  Clare replied 2 years ago.
Hi
What explanation have they given for that - and what exactly are you seeking to ensure?
Clare
Customer: replied 2 years ago.

They advise that creditors could pursue A and claim that she was attempting to hide capital by understating the value of the property at the time of the Declaration. They further advise that such a declaration would not protect B from action by A's creditors.

Expert:  Clare replied 2 years ago.
Hi
Right - that is of course a slightly different take on the actual issue.
Is A close to Bankruptcy?
Is A accepting less than half of the actual equity?
Clare
Customer: replied 2 years ago.

A is close to bankruptcy.

She is accepting half of the equity

Expert:  Clare replied 2 years ago.
Hi
Excellent
So you will have evidence that A has received the full amount for her share (make sure that you have at least three valuations)
You then register the Declaration of Trust at the Land Registry which ensures that any application by a creditor can be thwarted as well
Clare
Customer: replied 2 years ago.
Local opinion is to use declaration of transfer as best way to resolve situation. Has added benefit of removing A from register. Little or no support for declaration of trust.
Expert:  Clare replied 2 years ago.
Hi
I am sorry - I thought that B cannot release A from the mortgage - obviously if B can that is indeed the best option
Clare