tennants in common / buying out flatmate

[confused????]

Please can someone help, I have bought a place with an ex-friend of mine 2 years ago and I am now considering buying her out as our relationship has broken down. I would like to know what i would need to pay her if i was to do this. We both paid 50% share of the deposit and both pay an equal share of the mortgage each month. Would she get her deposit back? Would she get 50% back of what she's paid soo far on the mortgage and would she get 50% of the new value of the house? How would i get the ball rolling in this? Please please help. Thank you

[scorpio61]

Hi confused, it's quite simple to buy her out provided you fit the the required profile for a lender, eg you have enough income etc. In short she is entitled to 50% of the available equity. Example, current property value �100K, original price (or outstanding mortgage) �80k, there is �20,000 equity, she is entitled to �10,000. If you need any more help or a quote contact me through  website and ask for Pete

Good luck

[confused????]

Thank you very much for your reply.

Say we bought for                                                          �140,000

Paid �3,500 deposit each                                                     - �7,000

Amount paid off on the mortgage so far                                                         - �5,000

 

Outstanding mortgage                                                   �128,000

 

New value of house is                                                   �160,000

 

How much would I need to pay her?

 

Thanks in advance

[scorpio61]

On what you've given me (remembering you'll incur charges of between 1 to 2 thousand on the remo) you would have to give her approx �15,000 (half of �30K)
 
To get a remortgage on �143,000 would require a minimum salary of about �35k a year unless you are self employed and want to do a self cert mortgage, then you would declare about �40k.
 
The lenders also do a credit check. If you have had some problems in the past you can only lend 85% of the value of the property which equates to �136,000, which may cause you some problems, I may be able to find someone to go to 90% (releasing �144,000) provided the property is not a flat.
 
If you are still on speaking terms it might be an idea to explain this to her or even let her read this email.

This is a generalised view and not accurate to individual circumstances but I hope this helps

Pete

[zmudge]

You ask how to start matters moving, and as you have a mortgage you must simply write to your lender telling them of your proposals and seeking their assistance and consent. If they consent (and they are not obliged to) you will find that the lender will insist upon doing all of the work themselves (both yours and theirs, and including the Land Registry) and that they will do this under the heading of "Transfer of Equity". A usual charge is about �250. Without going into the reasons you will almost certainly find that your lender will require your ex to appoint a solicitor, and this must be accepted. Before the entry can be changed at the Land Registry you will have to complete the Stamp Duty Land Tax form (more than 70 questions - quite complicated -and if you get it wrong in any way the Revenue will return the form and block the transfer). Some transactions require that Stamp Duty is paid and to check whether your transaction falls for Stamp Duty and, if so, how much, phone [phone] and give them your figures. 

[josieann]

Are you both on the deeds and the mortgage and if so is it a joint tenancy or tenants in common

[confused????]

We are both on the deeds and we are tenants in common 
 

[tiffi]

I am currently in a similar position and have just sort after legal advice. I was told It doesn�t matter how much money you put into the property (eg deposit) as long as it was even � split 50/50, then all you have to do is get an estate agent to value the property (or 3 and take an average) and then divide in half and that is how much she is owed. So if the property has increased in value you will have to pay her her share of the equity. Eg property bought for 100,000. Now valued at 125,000. You take over the remaining mortgage (100,000) and pay her 12,500 (half of the equity)