Divorce

[cousin jane]

Son and wife been together since 2006, cohabited from 2007, married 2014. She is employed, pension and about £25k shares. He is self-employed and has been since 2009, recently now a limited company. He is the only one in the company. House bought together in 2013 but in her sole name. I gave them £10,000 for the deposit. He has no pension.
They are now going to divorce (her decision), she left the house a year ago and he has been paying her each month for the full monthly mortgage payment, he is also paying all the household bills. At first they agreed he would keep the house and have the mortgage in his name, she would sell it him for the amount of outstanding mortgage (about £20k equity) he would continue with his business. She would keep her pension and shares. Now she wants half the house and half his business. There’s not much money in his business as he rents the premises and has about £5k in his business account. I realise they will have to take into consideration the cost of the stock he has. They both have a car each, he also has a car worth about £8k which he has been working on for a number of years but still lots to do on it.
He is making an appointment with a solicitor but in the meantime can anyone offer any advice on where each one would stand.
He doesn’t want to have to end up with a big solicitor’s bill and would prefer to sort it between themselves but it’s looking highly unlikely. He also thinks she should start the divorce proceedings and let her pay the court fee.

[davebro]

Rather a complicated scenario to get a quick answer from the internet. Due to the length of the relationship/marriage I would have thought total everything up and go 50/50 splitting the assets in the most convenient way.

I know someone divorcing after a 4 year marriage and the wife is getting (I think) a third of everything even though she contributed very little financially.

[cousin jane]

Thanks. They have both contributed. So if it was 50/50 o everything would that mean she could get 50% of his business?

[hc4361]

If she wants to go down that road he will be entitled to half her shares, half the equity in the house and maybe a portion of her pension. Nobody will come out a winner.
Your son should consider offering to let her keep all of her shares, her pension, her car. In return she would allow him to buy her out of the house as had previously been agreed; he keep his business and his cars.
That's not only sensible, it will be by far the cheapest and most cost effective way for them to manage the division of their assets.

I assume there are no children and neither are close to pension age.

[AuntPollyGrey]

^^^ Agree wholeheartedly . One partner cannot give 50% of their net worth without the other one reciprocating, and I'm sure your DIL does NOT want to give him half of her shares and pension. She will be advised this by her solicitor.

[cousin jane]

Thanks for the replies. HC4361 thats what my son has offered plus both keep their own cars which are worth about the same each. But she is saying she wants half the house and business. Thankfully there are no children involved. They are both 36.

[ummmm]

Did you get your 10k down in writing?

[hc4361]

Half the house would give her £10k (probably less due to costs involved); she would lose £12.5 in shares so she is already at least £2.5k down.
How to value a business - tricky. What exactly does she want from the business? Have you read this?
https://www.moneyadviceservice.org.uk/en/articles/dividing-business-interests-on-divorce-or-dissolution

[AuntPollyGrey]

Next time she mentions she wants half the house and business advise your son to reply 'That's fine, but I want half your shares and pension' That may stop her in her tracks.

[cousin jane]

Thanks HC. Aunt Polly he said that to her and she just laughed and said go see a solicitor!
Yes the £10k is in writing.

[hc4361]

Your son should also stress that if they can sort out the finances between them they can have a DIY divorce without involving solicitors. It is relatively easy and will save them both a small fortune in solicitors' fees.

https://www.gov.uk/divorce

[ummmm]

How long ago did they split?

[cousin jane]

Thanks again, they have been split a year. As my sons been paying the mortgage for a year can this be taken into account?

[hc4361]

To a point but of course he has had the total and sole benefit of the house since she left. If he wasn't living there he'd have to pay rent/mortgage and bills elsewhere.

[ummmm]

Like hc says, he would have had to pay regardless of where he was living.

A year is not long. Could this be just anger?

[cousin jane]

Makes sense, thanks HC.

[hc4361]

Are you concerned about the £10k you gave towards the deposit? Was it a gift or a loan?

[cousin jane]

Its been on the cards for a couple of years now. I'm not concerned over the £10k she has always agreed and still does that I get this back. It was legally done when they bought the house.

[hc4361]

Even more pointless her going for half the house then - they will get around £5k each and she will lose £12.k in shares.

[cousin jane]

Lets hoe she comes to her senses

[hc4361]

Hope so