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Stuart J
Stuart J, Solicitor
Category: Family Law
Satisfied Customers: 26799
Experience:  Senior Partner at Berkson Wallace
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Just in the middle of a divorce. I am seeking some advice on

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Just in the middle of a divorce. I am seeking some advice on a financial settlement.Below some facts to assist:
Married in September 2016, one son, aged 5. Separated on June 3 2021 when my wife left for someone else.
Matters have remained amicable and we share care of son on a 50/50 basis. I have remained in the marital home, wife moved out. However, the legal title is in wife’s sole name and the house is semi-tied up with wife’s family, ie I think the house was purchased from a member of wife’s family, her nan lives next door, her mum gave us a loan of £162,000 to buy the property. There is no charge/mortgage on it.
Initially, I had been hoping to stay in the house and buy out wife. I had looked into securing a mortgage to pay off the mum’s £162,000 and give wife £100,000. Things have moved on since then, I realised there would be “conditions” imposed, ie I wouldn’t be allowed to sell while her nan is still alive plus I couldn’t actually borrow that amount. On balance, I now feel that I want to move on and not stay anyway. However this has now caused issues as to what is due to me. Additionally I work for free for them every Sunday.
The house is valued at somewhere near £500,000. Minus the loan from her mum, leaves equity of around £328,000. Wife has offered to give me £50,000 and she will move back in because she needs to give Hudson a home!!
I was under the illusion that she could “buy” him out at £50,000 because he has no interest in the house. I have now heard that I have a beneficial interest in the property. Also it's not just her housing needs that matter, I also has housing needs as we share Hudson 50/50.
Her mum has agreed to “pay off” (ie write off) the loan of £162,000 and effectively gift this to her. So she would be sitting pretty in the house, move her new man in and share the ongoing cost of bills etc with the new man.
I now don't think that an offer of £50k is very fair but was not sure . Help please!

Hello. My name is***** you for the question.

It is my pleasure to assist you today.

I have been in the legal profession, in High Street practice, for almost 30 years so I have wide range of experience in a great many different aspects of law.

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I apologise in advance if you suffer a delay.

Kind regards.

Customer: replied 13 days ago.
thank you

How long have you been together and married in total?

how old is the child?

and in what way is this house tied to her family?

Customer: replied 13 days ago.
Married September 2016 but got together few years prior.
Hudson is 5
House in her name. Wife's mum bought the land. Built property. There was a loan in place, figure much lower than actual value of land but we have that in signed docs. Original loan was £182,000 now left £162,000.

Thank you.

What will happen with regard to the division of marital finances is that everything will be lumped in together including pensions. With regard to pensions you will need a Cash Equivalent Transfer Value (CETV) which converts the pension to a lump sum for the mathematical calculation. You cannot get hold of that money but it converts it to a theoretical cash equivalent.

All the value of the assets are then lumped together and there is a division which starts off at 50-50 and it would then be adjusted in favour of one spouse or the other spouse depending on the needs of the parties, how long they have been married, where the money came from, et cetera et cetera.

Not just the length of the marriage would be taken into account but also any length of time together before marriage because it would be unfair if the couple were together for 29 years and only married for one year before splitting up (not uncommon) to be treated in the same way as a couple who had a whirlwind romance got married, were married for 12 months, and then split up. So the whole length of the relationship would be taken into account.

It’s largely a mathematical thing but does look at needs after divorce.

Even if everything is being divided down the middle, it’s not really a case of dividing it down the middle, all the assets wouldn’t be split 50-50 but, for example one person may keep the house and the other for example could have the savings and the pensions.

With regard to the house,…

You have to remember that if you have dependent children, under 18, the situation can be completely different.

Parents are under a duty to provide a home for dependent children until they reach 18 and therefore, unless there is a lot of equity in the property, sufficient to release some money to the non-resident parent AND provide a home for the resident parent aAND the children until the youngest reaches 18, it’s unlikely that the non-resident parent is going to be able to force a sale of the property.

The only good news is that the party that remains in the property is responsible for the mortgage and the bills.

The situation would be completely different if there were no children and it would be infinitely possible for the person wishing to sell to force a sale of the property if necessary under section 14 of the Trusts of Land Appointment of Trustees Act by applying for an “order for sale”.

Dependent children, under 18, change all that. However in those circumstances the resident parent would be responsible for the mortgage and the bills not the non-resident parent although there is still the possibility of child maintenance and spousal maintenance.

If the parent with residence of the children cannot afford doesn't want to live in the property because, for example, it's too big, they can always sell it and asked the court to apply the proceeds to a new house to provide a home for the children until they reach 18. Only then would it be sold.

You say that there is equity just over GBP300,000 which is probably just enough to buy a three bedroomed house although it depends where you live.

If child residence is genuinely 50-50 then no child maintenance is payable.

There is a possibility of a liability for spousal maintenance, maintenance paid to keep a spouse , as opposed to children. Although most commonly paid from husband to wife, that is not necessarily the case. Spousal maintenance is based on both incomes, ability to earn money, previous lifestyles and most importantly, need. It is not about equalising incomes. There is no exact formula, but these links will give some reading..

https://www.blbsolicitors.co.uk/blog/spousal-maintenance-how-much-and-for-how-long/

and

http://www.familylawweek.co.uk/site.aspx?i=ed33597

and

https://family.findlaw.com/divorce/questionnaire-are-you-entitled-to-alimony-spousal-support.html

And here is an interesting and informative article with regard to the division of finances in general

https://www.lawteacher.net/cases/financial-matters-on-divorce.php

And finally, here is an article what happens to inheritance in the event of a

divorce:

http://www.marilynstowe.co.uk/2011/05/18/what-happens-to-an-inheritance-in-the-event-of-divorce/

If the child was 18, then there is a good chance that everything would be split close to 50-50 but as it is now, it appears to be “take 50 grand now or wait another 13 years to get half of the house” (when the child reaches 18.

What you have to ask is whether waiting that period for the Lions share or rather closer to 50%, as a practical proposition for you.

The only good news is A person is not responsible for the mortgage or rent or the bills of a house that they do not live in although they remain liable to the lender or landlord if the other person stays in the property and doesn’t pay the mortgage or rent.

In that case, the non-occupier would be entitled to recover any mortgage or rental payments made by the non-occupier, from the occupier within the finances of the breakup of the relationship/marriage.

Thank you for letting me assist you with your legal question. I am glad that I was able to help.

I am not certain whether that answers the question for you or not, but I am happy to answer any specific points arising from this.

It will be my pleasure to help you again either further with this or any future questions you have

Kind regards

Stuart

Customer: replied 13 days ago.
Thank you for this.
But there is only circa 300,000 equity in total. Are you saying that she would have to buy me out at £150,000. We would not be able to buy much with that where we currently live. Or are you saying that she should stay in the house and I get my money when Hudson is 18? I need to be able to house myself now so not sure if a viable option.
Also she has said in passing that her mother would intervene as she put all the money down for this property. however I do believe that the works which I have done to the property (I have receipts for a lot) mean I have an interest. How would I calculate that? Unfortunately I would give cash to the mother. I don't think that they would get nasty but would not be happy if I suddenly started to ask for 50%.They have offered 50K, I think that is low, is there a way to calculate this? What would be a fair figure? Can the mother intervene? She does have an interest and there is a current loan to her which we have to pay back by August 2022 otherwise the property sells so that she gets paid.

You need to forget the fact that her mother may donate that money to her. It’s after the event so that’s not even in the equation.

You have a dependent child and therefore unless a sale of the house would produce enough equity to provide a home for the child until the age of 18, and it’s highly likely that sale is not on the cards.

You could argue that as the residence of the child is shared 50-50, nobody should get the house and the net proceeds should be divided 50-50 so that you can both make equal provisions.

A lot would then depend on what assets you would both have and what you both earn including earning capability, after the breakup

Customer: replied 13 days ago.
it does not matter that the mother was the investor too so that the land and build was possible? My wife is saying that the mother would intervene on this basis so that I don't get 50:50 as I do not have a 50% interest.

The mother was an investor/lender in exactly the same way that a mortgage lender would be. It wasn’t a gift either of you, she wanted to be repaid.

She can then decide that she doesn’t want the money back from her daughter or she does want the money from her daughter or she has the money back from her daughter and then gives it to her daughter again. So that money needs to come out of the equation as something to be repaid, a debt on the marriage/house.

All the debts and mortgages and loans on the house get paid first and then there is the division. The fact that it’s her mother, in these circumstances is irrelevant.

Customer: replied 13 days ago.
Thank you

No problem at all. I’m glad to help.

If you don’t have any further questions, I will mark this question thread as complete for now, but don’t worry, the thread stays open if anything else crops up over the course of the next days weeks or months.

I’m glad that I was able to help.

Thank you for trusting Just Answer with your legal problem.

Kind regards

Stuart

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