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Asking for friend & work colleague. His bother died unexpectedly last year and he's trying to sort the estate.
The deceased brother had a house with mortgage against it and left two small children. My friend isn't in a position to cover the mortgage and the house needs work to be fit to rent so is on the market. Since Truss's budget the market has crashed and the only offer is £25k below asking.
The problem is the deeds/mortgage still have the name of a failed relationship from approx 15years ago before the children were born - basically bought the house together, relationship quickly failed the deceased carried on in the house paying the mortgage. Not sure if the previous partner was paid off at the time or not.
The named person is now causing problems as they are staking a claim to the equity once the mortgage is cleared and isn't wanting to accept the lowball offer and is pushing for the previous market value despite the mortgage lender starting to close in with repossession.
I know it'll probably end up in a legal/solicitor rangle but is there a quick clear answer to the above? My friend has had a lot to deal with the loss of his younger brother (nice guy who I knew socially) and now has this hassle as well.
Tia!
I'm guessing there's no will?
If their name is on the deeds, they have a 'claim' on the property - so either they accept an offer or it will end up in court.....
I’m guessing there’s no will?
Won't over ride the fact their name is on the deeds as the will only affects the portion of the house the deceased owns - not the bit the other person lays claim to. The exact split would have to be agreed first....
Crap situation.
I would have thought that unless there's proof that the partner was removed from the mortgage and deeds then she may well have a right to half the 'profit' from the house sale (although she will be liable for CGT on that money).
She needs to realise that if the house is repossesed the BS will sell for any price as long as they recover the unpaid mortgage value - so she needs to wise up!
the name of a failed relationship from approx 15years ago before the children were born – basically bought the house together, relationship quickly failed the deceased carried on in the house paying the mortgage.
He must have never changed mortgage in all that time, as this would have been spotted by the new mortgage lender.
The quick answer is that it will end up in a legal/solicitor wrangle, how convoluted/nasty that becomes depends on the parties involved.
She has quite a strong hand, nothing to loose and probably doesn't GAS about the people, but might make some money being an arse about it all....
Going to need a solicitor for your friend's piece of mind, especially with the ex-partner getting involved. What a mess.
That sounds like an awful situation.
I helped my now wife to buy out her ex. It took us years, agreement is essential. I can’t see a quick way out of that one.
Were they 'Joint Tenants' or 'Tenants in Common'?
Refers to existing couples, but if still on mortgage/deeds, im sure will have a bearing.
Your friend needs a good lawyer
IIRC - the named person has agreed to a percentage of the equity in line with 'what she put in' but is calling the shots with the house sale offer. The market has crashed and has gone from plenty of interest and viewings to one viewing and a subsequent lowball offer. It is still higher than the 'we buy any house' value which is where my friend was at before the lowball. If she drags her feet the house would end up repossessed.
If she drags her feet the house would end up repossessed.
Has she been made aware that holding out for more will very likely net her less?
It is no longer the case that banks sell repossessed properties at any old price to redeem the mortgage. If/when the case goes to court they have to demonstrate they sell the property for a fair market value.
Qualification: I deal with repos every day! 😂😐
If/when the case goes to court they have to demonstrate they sell the property for a fair market value.
Interesting..... but what defines a 'fair market value' in the middle of winter with a recession looming, interest rates on the rise and house prices falling?
It could be argued that it's whatever you can get for the house!
IIRC – the named person has agreed to a percentage of the equity in line with ‘what she put in’
Really?!! My wife is on the deeds and mortgage of our house but has put zero £££ into the mortgage repayments or any of the house running costs. Does that mean it's all mine? 🙂
*heads off to walk the dogs with a spring in his step*
I would definitely recommend they get a probate solicitor to deal with this. The fact the mortgage company is not chasing the estranged 'other person' suggests that the mortgage and deeds are tenants in common, but that needs to be checked, as does a check for any Deed of Trust. The mortgage company (original purchase) should have copies of this. A probate solicitor (or if there was a will, the executor of the will) has to sell the house for it's market value. Note it doesn't matter what an estate agent says it is worth, it is what the market will pay. Even though it will cost, it will be far better to have an independent solicitor explain the legal and financial implications to the other party. At this late stage, they might also ask the other person to visit CAB together and ask for independent advice? Especially as others have pointed out, if the other person refuses to sell, it is very likely the house will be repossessed and they will be financially worse off.
"Deeds" do these exist anymore, isn't it just whatever is on land reg?
“Deeds” do these exist anymore, isn’t it just whatever is on land reg?
Only if the house was registered at last change of ownership, wasn't required until 1989.
“Deeds” do these exist anymore, isn’t it just whatever is on land reg?
You don't need paper ones, but someone can still register an interest in a house on the electronic records with the LR or more than one person be listed as having an interest etc.
egister an interest in a house on the electronic records with the LR or more than one person be listed as having an interest etc.
Yes exactly, its not deeds though, its just the register.
Thanks for everyone who commented - I pinged it to my friend so he's read the thread.
If they were joint beneficial tenants then the surviving joint owner on the deeds inherits the property by survivorship. If they were tenants in common then the default is 50/50 unless it can be shown that the ownership was different this would normally be by way of a trust deed.
Your friend will need legal advice to sort this out. I am a Probate lawyer and civil and commercial mediator so have experience in this area. Happy to have an initial conversation with your friend and point them in the right direction.
Drop me a PM if it will help.