Joint Mortgage-Can I Be Forced To Sell

[Esjaybee]

Basically the scenario is I bought a flat with two "friends" who are now married. They have moved out but are continuing to pay their share. It's split 3 ways but only two of us are on the mortgage.
I still live in the flat. Can they force me to sell if I don't want to? I can afford the mortgage and all other costs by myself.

[pixie373]

I'm sure you could offer to buy them out if it comes to it.

[hc4361]

If you can't give the others the equity they are entitled to then yes, they can force you to sell.
Another way round it would be to pay rent the co-owners. After all, you are getting all the benefit.

[pixie373]

He says he can afford it all himself, so he shouldn't need to be forced out.

[woofgang]

It depends a bit on the mortgage too. Some joint mortgages insist that if any of the mortgage holders wish to leave the agreement, the other(s) can't buy them out, but the mortgage must be ended and a new one taken. This may mean selling the flat or it may not.

[ubasses]

Unfortunately if it only the monthly costs you can afford, but not to give them their equity back, yes they can force a sale. Have you looked into the possibility of increasing your mortgage to buy them out?

[ummmm]

But is Jaybee thinking the payments would stay the same?

[pixie373]

Fair enough, woofgang. May be worth speaking to the mortgage people first, then.

[hc4361]

That's not the point, pixie. The co-owners are entitled not only to be released from the mortgage they are also entitled to their share of any equity in the property. That could be a substantial amount.

[pixie373]

Yes, of course they are, hc. I think i misunderstood him saying he could afford "all other costs" assuming they'll obviously want their money back.

[hc4361]

As far as I know a new mortgage would have to be taken out in all circumstances, rather than carrying on with the existing mortgage. The co-owners names would need to removed from the Title Register and the mortgage.
A mortgage company would need proof that you can afford the mortgage on your own. You saying you can afford it is not enough.

You will need to find out how much your flat is worth now to get an idea of the equity, then you'll have an idea of how much it is going to cost you.

[hc4361]

Apologies for the misunderstanding, Pixie.

Esjaybee is fortunate not to be paying rent to the others as well as his share of the mortgage.

[Esjaybee]

So it looks like the first port of call is to find out exactly what my mortgage states regarding this.
I've already had a valuation done. And I had an oral agreement with them that I would pay them equity in monthly installments, but I can't count on them staying true to that.

[Esjaybee]

Also no equity figure has been agreed as yet

[hc4361]

Yes, you need to speak to the mortgage company.
If you do all decide to go ahead you should also draw up a proper contract in respect of equity payments so neither side can renege.
You should also bear in mind that mortgage rates are artificially low - very low - and are likely to go up substantially.

[hc4361]

When did you buy the property and when did the others move out?

Each of you should get a valuation of the property and take the average to be the true figure.

As you have had sole enjoyment and benefit of the flat for a period of time it is reasonable that the co-owners should get a larger slice of the equity, unless you have been paying them rent.

[FredPuli43]

They need a court order first. This applies to all properties, including business property, owned by two or more and even when the party concerned has a minority interest. It's usually a formality because the justice of the case demands it. In fact, the last time I sold a business property, my solicitors were aware of the law but never bothered with this nicety; they knew that it could never be opposed, so why bother?

[hc4361]

No court order needed if all parties agree - and unless you have compelling reasons for staying in the property it is a folly to let it get that far.

[bushbaby_de]

I am confused by the statement that three of you own it but only two are on the mortgage. This could get very sticky for calculating equity etc. I strongly suggest you take independent legal advice.