How to sell my share in a mortgage?

Sallyanne3

I have a joint mortgage, but for personal reasons would ideally like to get rid of it altogether.

Can i sell my share in the house say by advertising it, i'm not looking for huge amounts of cash, just a clean slate. (i know probably legal issues here)?
Can my ex object to this?

If this not possible, can i force him to leave the house and rent it out?

Could i have a solicitor draft a contract to say that i will leave the house myself on the understanding that ex will rent rooms out to cover the mortgage, to people of his own choosing, and not get me into financial jeopardy, so if anything does happen its nothing to do with me, and i gave him full responsibility?

I know its not as simple as just signing over the mortgage to him completely as he needs to show he can manage financially, and be able to give me moneey, so that is not possible i don't think.

Can anyone please advise? I will be going to a solicitor but i just wanted to see what other suggestions and ideas i would get prior to this.

Thanks

Jo King

Sallyanne3 wrote: »

I have a joint mortgage, but for personal reasons would ideally like to get rid of it altogether.

Can i sell my share in the house say by advertising it, i'm not looking for huge amounts of cash, just a clean slate. (i know probably legal issues here)?
Can my ex object to this?


Thanks

The chances of anybody buying are slim to none!

Sallyanne3 wrote: »

If this not possible, can i force him to leave the house and rent it out?

No

Sallyanne3 wrote: »

Could i have a solicitor draft a contract to say that i will leave the house myself on the understanding that ex will rent rooms out to cover the mortgage, to people of his own choosing, and not get me into financial jeopardy, so if anything does happen its nothing to do with me, and i gave him full responsibility?

You could but it will not get you off the hook. You will still be liable for the mortgage and there will be tax implications.

Sallyanne3 wrote: »

I know its not as simple as just signing over the mortgage to him completely as he needs to show he can manage financially, and be able to give me moneey, so that is not possible i don't think.

You should force the sale of the house under the Partition Acts.

antoinolachtnai

You have a commercial problem here rather than a legal one.

Basically all you are likely to be able to do legally is force a sale of the entire. I take it you do not want that. I also take it that you were not married.

The reason is that it is impractical to force your ex to share his ownership with you.

Then bank is not going to let you off the hook. That is what you really want. But it is not in their interests to do this. They might do it, but they probably won't.

Maybe some relative of your ex could take your place on the mortgage? There might be a commercial benefit to the bank in this and they might go for it. i don't know about the legalities.

A lot depends on the personal circumstances. The amount of equity you have in the house and the number of years left on the mortgage and the level or repayment makes a big difference.

Sallyanne3

hmm.. we have 33 years left, mort initially at 258, now at about 256!
We have also gone interest only at the moment..

I could afford to leave now, but only to have to come back when the interest only period is up makes that impractical. ( due to not being able to afford to apy rent and a mortage)
Its a bit of a mess, and i love the idea of one of his relatives could take over my share, but that wouldn't happen, they're too careful and not well off enough i think.

I wonder would something like this be attractive to a business man in terms of looking to the future and possible rising of house values?

This is an attractive area and house prices are still good. near dublin, great public transport etc.

Mike...

you keep dreaming about rising house price's etc etc...
Unless you had some legal agreement drawn up before the mortgage....your stuck with it.

Your no different from everyone else out there having mortgage difficulties or relationship issue's. I don't see why he has to keep the property,you and one of your lot could try and buy it, or does your crowd not have the money for it?

D3PO

Sallyanne3 wrote: »

Its a bit of a mess, .

Absolutly it is. I really cant understand why unmarried couples dont cover these eventualities with their solicitor before buying.

anyway back on topic you cant force him to sell or to move out. If you want a clean break the best option is to try and sell your share of the property to him i.e get removed from the deeds and the mortgage.

this in practical terms will probably prove extremely difficult for a number of reasons

1) Hes not going to buy at the rate you paid so you will have to sell your share to him for a reduced rate and will still be on the hook for the difference

2) the tax implications associated with it are going to be a pain

3) Its probably fair to assume he cant afford it given you bought together and are only able to pay interest only right now.

I would suggest the best solution for you is to try and rent 1 - 2 rooms out in agreement with your ex to help covert the payments and you continue in the agreement.

Things are a heck of a lot more complicated in a falling market unfortunatly.

antoinolachtnai

A businessman won't invest in the property, because the bank would have priority over his right to the property. That's the commercial problem. (Well, one of them, there are other problems with co-investing in residential property with the occupant.)

All you can do is maximize the income from the house and pay back as much as you can as fast as you can. The other thing you can do, once you've seen the solicitor is talk to your ex about it. It's a serious situation, but if you talk about it and face into it together, it isn't the end of the world.

Sallyanne3

That all fair enough really.

I don't know myself why we didn't cover things like this, it was never suggested to us by solicitor or anybody and we didn't think on it, and i know a lot more now than i did when i got into the mess!! (I was 23 then and young at that)

Sure what can i do but make the best out of it?

i'll visit the solicitor and see what suggestions can be made, i wouldn't imagine there would be too much different to what i've been told here and now but its worth a look.

And yes, possibly i may be able to get someone, somewhere in my family to help, but that would be a last resort.

Ta

Sallyanne3

antoinolachtnai wrote: »

A businessman won't invest in the property, because the bank would have priority over his right to the property. That's the commercial problem. (Well, one of them, there are other problems with co-investing in residential property with the occupant.)

All you can do is maximize the income from the house and pay back as much as you can as fast as you can. The other thing you can do, once you've seen the solicitor is talk to your ex about it. It's a serious situation, but if you talk about it and face into it together, it isn't the end of the world.

I think so too, it just a matter of dealing with it objectively and trying to make the best out of it.Exploring every avenue so to speak.

D3PO

Sally if your solicitor didnt suggest you cover this eventuality prior to buying id suggest you find a new solicitor to deal with the current situation as they really should have brought this theoretical situaiton to your attention at that time.

also if you can id suggest you move from your interest only agreement if you can, your burning money and with interest rates as low as they are you should really be hoping to pay off some of the loan right now.

you sound like you are a sensible woman just make sure to keep a good honest open communication flow going with your ex to ensure you can deal with this as best as possible despite whatever animosity may or may not exist as a result of the breakup.

kmick

Is it worth more or the same as the mortgage amount? If its worth less it will be almost impossible to dispose of and the bank may not even allow you to sell it.

If its worth more then all you can do is convince the other party to sell up.

Sallyanne3

I want to handle this all as fairly as possible, i am actually checking to confirm i am on the title deeds at the moment, just in case i'm not, its so long ago i can't remember all the bits i signed.

Yes our solicitor at the time was a horrid nitemare, and i have no intentions of going back there.

I would love to move from interest only, but as i recently moved to a lower paid job it isn't an option for me, and ex will defintely not make up any deficit.. i scape by on about less than €90 per week after all expenses, not including going places and socialising.

And if i left interest only now.. I'd be asked why i put the prices up! lol, some people think i am a banking institution, and can't understand otherwise!
If you can't laugh....

Sallyanne3

kmick wrote: »

Is it worth more or the same as the mortgage amount? If its worth less it will be almost impossible to dispose of and the bank may not even allow you to sell it.

If its worth more then all you can do is convince the other party to sell up.

I don't know at the moment. It had 3 valuations a few years ago(2.5), lowest at 330.Highest 390
Mortgage is 258.

Sallyanne3

or rather 256 now i'd say

D3PO

Sallyanne3 wrote: »

I don't know at the moment. It had 3 valuations a few years ago(2.5), lowest at 330.Highest 390
Mortgage is 258.

Id suggest you are in neg equity taking 360k as a median value at the peak. hosue prices are down over 40% from that point.

Sallyanne3

oh ****zer!....:eek:

Oh well, have to see what we can do...no point panicing...there must be a good solution...

'I will not panic' I'll play this in my head on a loop!! :rolleyes:

Sleipnir

Sallyanne3 wrote: »

Can i sell my share in the house say by advertising it, i'm not looking for huge amounts of cash, just a clean slate. (i know probably legal issues here)?
Can my ex object to this?

Of course you're ex can object to it. You would effectively be selling your half to someone who is a total stranger to your ex. You wouldn't be able to sell your half without him going into a contract with someone he doesn't know. He would have to agree in the same way that you both had to agree when you took out the mortgage.

Sallyanne3 wrote: »

If this not possible, can i force him to leave the house and rent it out?

Could i have a solicitor draft a contract to say that i will leave the house myself on the understanding that ex will rent rooms out to cover the mortgage, to people of his own choosing, and not get me into financial jeopardy, so if anything does happen its nothing to do with me, and i gave him full responsibility?

No, you can't force him to leave his home.
You also can't get a solicitor to force him to take responsibility for your half of the mortgage. You own half, but you're also responsible for half.
How can you legally make him responsible for your half when legally, you're responsible for it!
You'd also need the banks agreement.

Sallyanne3 wrote: »

I know its not as simple as just signing over the mortgage to him completely as he needs to show he can manage financially, and be able to give me moneey, so that is not possible i don't think.

It's not a case of you signed the mortgage over to him. It's a case of him taking over the mortgage 100%. If he doesn't want to do that or can't afford it, he doesn't have to. You're still responsible for half.

Sallyanne3

Very useful info there....

Jo King

D3PO wrote: »

anyway back on topic you cant force him to sell

You can force him to sell. Use the Partition Acts. In all the circumstances this is the best thing to do. Sell the house off, even at a loss and pay off the mortgagor. Renting rooms out is going to cause tax problems and hassle for years to come.

D3PO

Jo King wrote: »

You can force him to sell. Use the Partition Acts. In all the circumstances this is the best thing to do. Sell the house off, even at a loss and pay off the mortgagor. Renting rooms out is going to cause tax problems and hassle for years to come.

you cant force him to sell. seriously i have no idea where you are getting that from

Senna

Jo King wrote: »

Renting rooms out is going to cause tax problems and hassle for years to come.

If your fella is still in the house, you can use the rent-a-room scheme to get rent up to 10k per annum without paying tax.

If your in negative equity, do you have saving or has he savings that could be used to pay off the remaining balance of the mortgage after the sale (if sale price is less than mortgage)?

Sleipnir

Jo King wrote: »

You can force him to sell. Use the Partition Acts. In all the circumstances this is the best thing to do. Sell the house off, even at a loss and pay off the mortgagor. Renting rooms out is going to cause tax problems and hassle for years to come.

Partition Act;

If a spouse deserts the home or refuses to agree to its sale because of malevolence, stubbornness or mental illness, the other spouse may apply to the court for an order dispensing with consent - but a dispensation is not retrospective and must be obtained before any sale.

A co-owning spouse who wants to separate, sell the home and divide the proceeds with the other spouse may apply to the court for an order for sale in lieu of partition, as no purchaser is likely to want to buy a half share of the house and become a co-owner with the remaining spouse.

Also, OP and ex aren't married.

No mention that the courts can force the other party to sell so that one party can simply waive their responsibilities and get out of it.

Jo King wrote: »

Sell the house off, even at a loss and pay off the mortgagor.

How can you sell the house for less than the mortgage, and still pay off the mortgage to the bank?

D3PO

the partition act is irrelevent here. i challenge jo king to provide a judgement in this circumstance where the home would be sold at a loss against one parties consent

Jo King

Sleipnir wrote: »

Partition Act;


Also, OP and ex aren't married.

No mention that the courts can force the other party to sell so that one party can simply waive their responsibilities and get out of it.



How can you sell the house for less than the mortgage, and still pay off the mortgage to the bank?

That quote is not from the Partition Acts 1868 or 1876.
The Partition Act 1868 can be found at:
http://www.bailii.org/nie/legis/num_act/pa1868134/

The Partition Act 1876 can be found at:
http://www.bailii.org/nie/legis/num_act/pa1876134/

There is no mention of the word spouse in the Partition Acts.
You can pay the bank the difference between the selling price and the outstanding mortgage.

See the case of decided by Barr J. in FF v CF. 81 [ [1987] ILRM 1 ] The plaintiff and defendant were joint tenants of a matrimonial home which was held under a lease with Dublin Corporation. On an action by the husband for sale of the property under the Partition Acts, the President of the Circuit Court held that he did have power to order sale in lieu of partition, notwithstanding the repeal of the 1542 Act .

Jo King

D3PO wrote: »

the partition act is irrelevent here. i challenge jo king to provide a judgement in this circumstance where the home would be sold at a loss against one parties consent

First National v Ring [1992] 1 I.R. 375 held by Denham J. in relation to a family home:-

"although the monies achieved on the sale of the premises on the market at this time would not nearly meet the debts, this was not a valid reason to refuse an order for sale."

Sleipnir

But it's of no use in this case!

"although the monies achieved on the sale of the premises on the market at this time would not nearly meet the debts, this was not a valid reason to refuse an order for sale."

That doesn't mean the debt is no longer owed!

The Partition Acts can be used to force the sale of a property if one party doesn't want to sell; fair enough.

Let's take OP's case.

Bought a house with BF with a mortgage for 258,000.
Mortgage is now 256,000; both are equally responsible for 128,000.

1.) if OP uses the Partition Act to force a sale of the house entirely; who is going to buy it? The boyfriend? For how much, 128,000? It ain't worth that now and he probably wouldn't get the loan anyway. Can you use the partition act to force him to buy it for the 128,000? No.

2.)Use the partition act to sell the house and you get less than the mortgage but what do the bank want? The mortgage; 256,000 please!

OP is still responsible for half the mortage and the partition act doesn't change that.

Ste.phen

i don't think anyone disputed that the OP and her OH would still be liable for the difference if the house was sold at a loss, that's not really relevant (except that she'd have to satisfy the bank that they'll pay the difference, it's not at all clear that the bank will allow it).

Sleipnir

Ste.phen wrote: »

i don't think anyone disputed that the OP and her OH would still be liable for the difference if the house was sold at a loss, that's not really relevant (except that she'd have to satisfy the bank that they'll pay the difference, it's not at all clear that the bank will allow it).

Well then, as has already been pointed out, the whole "use the partition acts to force him to sell" suggestion is also irrelevant.

Jo King

Sleipnir wrote: »

Well then, as has already been pointed out, the whole "use the partition acts to force him to sell" suggestion is also irrelevant.

HE can be ordered to sell and pay off the difference. O/p wants to bring the situation to an end. She doersw not want to spend years locked in this situation. Boyfriend has a choice: take over her interest in the mortgage, if he can or sell out and owe his share of the balance.The bank will allow a sale on receipt of the solicitors undertaking to discharge the outstanding balance.
The o/ps other option is to stop paying repayments. \The bank will eventgually bring ejectment proceedings if the repayments are not coming in. The o/p will be left owing the difference between the balance outstanding plus the bank's legal costs.
The Partition Acts are the best method for the o/p to get out of this.

The_Conductor

In short.

The OP and her ex owe 256k on their mortgage.
The property has a current theoretical value in the region of 180-190k (they really need to get a valuation done on it).

This means there is a deficit of around 60k of negative equity associated in the property.

If the OP wants to walk away from the property- come what may, it will cost her a minimum of EUR30k to do so (assuming the property can be sold at 190k- which should not be taken as a given).


OP- were you to suggest renting the property to your other half- would he be in a position to pay a rental income sufficient to cover 1/2 the mortgage interest- in which case you could allow the property to 'sit' (though he would gain rights as sole occupant of the property).

Another thing to consider- ECB rates are currently at 1%. It is proposed to commence rising rates by Q2 2010- with normalisation of rates at 4.5% by Q4 2012.

Are you in a position to pay- even the interest component of the mortgage- if rates increase by 3.5% (which is likely, rather than something hypothetical)? This is likely to represent interest payments of more than double your levels- and at 7 years you loose *all* mortgage interest relief........

S.

Sleipnir

Jo King wrote: »

HE can be ordered to sell and pay off the difference. O/p wants to bring the situation to an end. She doersw not want to spend years locked in this situation

He has to pay the difference??
How on earth could the boyfriend be forced to pay the the entire amount just because the girlfriend wants out of the legally binding contract?

"I want out, I'm leaving you to carry the entire debt"
You think the courts allow one party to break the contract and make the other party entirely responsible for the debt?
You can't bring the situation to an end without the debt being satisfied.

You're also assuming that the boyfriend is refusing to sell out of malevolence or whatever which is usually where the partition acts come into play.
The boyfriend might be quite willing to sell the property entirely but knows that
a.) he won't get a buyer
b.) Even if he does, they'll both still owe a small fortune to the bank.