# Stuck in joint mortgage with friend...



## Ezdezat (12 Jun 2013)

Hi All,

Hoping for some advice. 

I bought a house in 2008 with a friend, and for obvious reasons (negative equity!) it's turning into a bit of a mess. Some background info;

Value of property - 120k
Mortgage - 240k over 35 years, variable rate with KBC, repayments 1250 per month approx

We lived in the house until about 6 months ago, we always envisaged we would live there for 4-5 years then either rent it out or sell up. We are both now renting separately with our respective girlfriends. The property is rented out at €850 per month (shortfall of €400). At the time of buying we earned similar salaries with similar prospects, and neither of us could afford a mortgage individually.

I now earn 50k PA + an 8k car allowance, I owe approx 30k on a personal loan & credit card, have 4k savings. I'm with my employer 9 yrs & prospects are good, my salary is likely to go up over the coming years, i intend to clear my debts over the next 3 yrs or so and build up some savings. I'm 33.

My friend earns 24k and is in temporary employment. Owes about 10k to the credit union and no savings. He's 34.

To cut a long story short - my friend is now refusing to contribute to the mortgage, saying he just can't afford it. We are now only paying the rental income off the mortgage, and it is in arrears. The bank have been reasonably understanding and we have been communicating with them, but the situation is obviously not sustainable. I don't want to contribute now to the mortgage, as half of anything I would pay would be reducing his negative equity also. 

Any options I can come up with aren't attractive;
1) The bank agree to take his name off the mortgage and he signs the house over to me - I would be taking on his negative equity.
2) We agree with the bank to sell - we are jointly liable for the negative equity which he likely can't afford to pay, therefore I would end up paying more.
3) I pay an additional €400 per month to meet the repayments - he reaps half of the benefit. 
4) We both continue to refuse to pay anything past the rental income - potentially end in repossession, and we will owe more than in option 2, due to legal costs & arrears etc. 

Are there any options here I'm missing? Would the bank consider unusual solutions in these circumstances, such as parking his half of the mortgage? 
Allowing us to sell up and split the negative equity 50:50? I doubt it, as likely I'm a safer bet to pursue for the joint negative equity.

I feel a bit like the harder I work to increase my income - it just exposes me more to the negative equity now tied up in the property. Obviously my gf and I are thinking of the future - eventually buying a family home etc., but I can't see an easy solution to this one. Just to note she would have no desire to buy into his negative portion of the property, understandably. I have been considering going with option 4, and rather than paying the bank, paying my contribution into a savings account which I could use if it got to that stage. I guess there are many pitfalls to this.

I should also mention that the property is in a Dublin commuter town, and I have no desire to move back into it. It was in a new development which didn't
turn out as idyllic as was promised, my gf hates the area, and we would be increasing our fuel costs drastically by moving back. 

Any input much appreciated.


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## burmo (13 Jun 2013)

Sticky situation. Just to be aware, are you paying tax on the rental income and have you registered with the PRTB? This news may cause some pain now but much less than in the future.


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## Ezdezat (13 Jun 2013)

burmo said:


> Sticky situation. Just to be aware, are you paying tax on the rental income and have you registered with the PRTB? This news may cause some pain now but much less than in the future.



Hi - yes registered with the PRTB and we cancelled the TRS. Not paying tax on the rental income but as I understand it we will both have to complete a tax return for the rental income in 2013, and as the income is less than the interest on the mortgage we should not be liable for tax.


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## Clarkey (13 Jun 2013)

Ezdezat said:


> Hi - yes registered with the PRTB and we cancelled the TRS. Not paying tax on the rental income but as I understand it we will both have to complete a tax return for the rental income in 2013, and as the income is less than the interest on the mortgage we should not be liable for tax.



Only 75% of the mortgage interest is deductible in computing rental profits.


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## Ezdezat (13 Jun 2013)

Clarkey said:


> Only 75% of the mortgage interest is deductible in computing rental profits.



Tks for the info. Have been keeping receipts also for work done on the property, ie spent €600 having the boiler repaired recently. Even at 75% we should be safe enough I'd say.


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## Lucuma (13 Jun 2013)

Lots of ways of looking at this one. 

You list the downside of Option 1 as you getting burdened with your friend's share of the negative equity, but realistically that's going to happen in all 4 Options. 

No, there's no way to get a bank to chase 2 people for negative equity 50/50. They will chase whoever has more money - in this case you. 

So if you continue as you are eventually the bank will repossess. Then the house will be sold by the bank (possibly at below market value if they're looking for a quick sale) and whatever the outstanding loan is, you will be pursued for. Because your friend has a job, albeit a temporary one, he may be chased for some but based on the figures you've shown, the bank will probably chase you for the lion's share. 

So if you are going to let the house be sold anyway, and are going to get caught for the negative eq anyway, then wouldn't it be better to pick Option 2 over Option 4? With Option 2 you control the sale of the house, and make sure it gets the highest price possible thereby reducing the amount you will have to pay off afterwards. 

Another way of looking at the whole thing is that if you take as a given that you are going to be paying off the lion's share of this negative equity in any case, then why not go for Option 1 at least then you'll have a house to show for at the end of it. With the other options you have to pay the neg eq anyway and have nothing to show for it at the end. 

I wouldn't bother keeping savings if I was you, unless you can do it in such a way that KBC can't find out about it  Maybe your gf could save for you. 
Maybe you'd be better off putting that 4k against your credit card loans, considering KBC will swipe it for the negative equity anyway.


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## TommyB (13 Jun 2013)

There is no nice outcome to this if he continues to earn very little and refuse to pay. The options you have listed are basically it. The person with the bigger income always has way more to lose. You can forget about getting another mortgage in the next ten years unless your financial situation drastically improves to take a huge negative equity hit. 

I would sit it out for a while and see if your friends earnings improve. That is your only hope to come out of this with your share of negative equity. You have a vested interest in his earnings now so maybe you could help him out with work contacts or job hunting. 

But again, he was very little to lose and you don't hold too many cards.


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## Bronte (14 Jun 2013)

Forget about option 4 that's a no go for you.  

Based on what's you've posted I'd go for option 1 if the bank agrees.  Otherwise Option 2.  

Only point to 3 is to prevent option 4. 

You're going to have to do some tough negotation with the bank, maybe you'll have to threaten not to repay if they don't let you do option 1.  But start off nicely with them.

You could do a side negotiation with your friend that he pays you say 100 Euro a month for say 5 years, pick an amount he can realistically afford, to give you some kind of contribution on the NE, and somethign that he could live with in order to get out of the mortgage.  If he's any way honourable he should go for it.  

No way should your GF get involved in this mess - bank would love her to no doubt.  Probably might be best to say you are single.


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## Ezdezat (14 Jun 2013)

Thanks all for the input. 
There seems to be a consensus that Option 1 isn't such a bad option. I fail to see this and at this point will not even consider it, unless I'm forced into it. I would be saddled with another half of a house i don't want, and a massive lump of negative equity, while the other party would walk away scott free? Surely this doesn't make sense. 

I have a closeout date of Sept in my head for a couple of reasons to try to come up with a way forward. One is that the mortgage changes to a (hopefully lower) variable rate in Sept. The bank, although they haven't agreed, seem to be reasonably understanding that they will only get the rental income until that point, while we work toward a solution. I am aware that i may need to bury my savings, either by paying them off my debts or putting them in my gfs name, if it gets messy. 

I have made a proposal this morning, that we agree to pay the shortfall proportionate to our take home pay. That would put me paying approx 2/3rds and him 1/3rd. I may be willing to pay more than that, but a condition would be that we have a solicitors agreement drawn up to say that whomever pays a greater share of the mortgage, takes a greater share of the equity, at the end. Hoping there is some equity of course...

So we'll see what happens. 

Do people think this is a reasonable offer? I should point out that as friends, we agreed from the start everything would be 50:50. Understand the definition of 'joint' is different from a legal standpoint, but in my eyes anything less is unfair.

I am really vehemently against options 1, 2, 3 and 4 and genuinely think my proposal is best for both of us in the long term. However if we can't come to agreement, I think I would allow the threat of option 4 to loom for a while to try force a solution, before my hand being forced into 1, 2 or 3, obviously seeking legal counsel during the process.


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## Dr.Debt (14 Jun 2013)

Here's option 5, Ask the bank to consider a split mortgage. 

Split the mortgage in half. You make full payments on your half (including half the rent)

He  pays just half the rent towards his part and the remainder is  warehoused until his situation improves, which it probably will in time.

You  guys are young. You have plenty of time to recover this situation and  the bank is unlikely to want to crystallize the loss at this stage due  to the high negative equity.

Do a side deal between yourselves  (legal agreement) to agree how the asset or liability will be divvied up  when the house is eventually sold

The monthly repayment is 1250 at present

Under the new arrangement
You pay 625 in total each month
He pays 425 from his "rental income"
Total 1050.

That leaves a shortfall to the bank of 200 per month which should be parked

I think the bank will run with this if you negotiate correctly.


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## Ezdezat (14 Jun 2013)

Dr.Debt said:


> Here's option 5, Ask the bank to consider a split mortgage.
> 
> Split the mortgage in half. You make full payments on your half (including half the rent)
> 
> ...


 
Thanks for this. This is the kind of solution he was hoping for. He is of the opinion that if we continue to play hardball with the bank, we can push them into offering some kind of solution like this, and this is the main reason why he is refusing to contribute. As part of the proposal i've put to him, i've stated that i'm open to similar alternate options if he can come up with any. 

I was of the opinion though that because we are both employed, and from the banks perspective can jointly afford to pay the mortgage,  they wouldn't even entertain something like this? That there had to be exceptional circumstances?
Has anyone in similar circumstances achieved such a deal with banks? Is it better to have someone negotiate with the banks on our behalf for such a deal? (i had contacted 'New Beginnings' although have not met them). 
Any info on this appreciated.


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## Dr.Debt (14 Jun 2013)

The bank will certainly negotiate with you especially if they get any hint that you may be considering the bankruptcy option. In this case the bank has a huge amount to lose in bankruptcy. They will lost the full negative equity portion plus the very onerous bankruptcy fees.

In the proposal, I put forward to you, the interest is being paid in full and you are still making a contribution to the capital. The shortfall is a mere 200 per month and your outlook is quite good. You do need to play your cards right. If the bank gets any sense that you are willing to pay the full amount on your own, they will suck it out of you.

Write them a letter, Spell out your proposal clearly and then adjust your monthly repayment to reflect this. Trust me when I tell you that the proposal is reasonable. After that, let the bank do all the running. Don't blink, Don't flinch.
I don't believe they will push it much further. In the proposal you need to stress your individual financial positions (that you are continuing to pay half and your friend will pay his half in full as soon as his situation improves)

Best of luck


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## Bronte (14 Jun 2013)

Ezdezat said:


> There seems to be a consensus that Option 1 isn't such a bad option. I fail to see this and at this point will not even consider it,
> 
> 
> . The bank, although they haven't agreed, seem to be reasonably understanding that they will only get the rental income until that point, while we work toward a solution.
> ...


 
Life's not fair, when you go into a business transaction with a friend this is what can happen. It's not his fault he cannot afford the mortgage, neither is it yours that you can.   The 50:50 deal is no longer on the table for you, unless your friend gets a well paying job.  

Don't assume that mortgate rates are going down, all Irish banks are extending their margin to make up for past and yet to be booked losses that are coming down the track very soon. 

You are now implying that you're going to make the situation even messier, by hiding money and all sorts. 

Are you not paying the full mortgage currently - you mentioned only paying the rent to the bank. Are you PRTB registered?

I see no reason why any bank would go for Dr. Debt's option 5.

Where is everybody living?  And what are the rents?


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## Ezdezat (14 Jun 2013)

@ Dr. Debt: This is a most interesting option and certainly worth pursuing. As a matter of interest have you had experience in this area, as I wouldn't have thought the bank would consider this. Would it not be wiser to just continue to pay the rental income during the negotiation, and not increase the payments €1050 until, or if, they agreed?

@ Bronte: I understand life is sometimes not fair. I am trying to be understanding of my friends situation, and i do sympathise. However, at the moment I'm really not that much better off financially. Yes i get a car allowance but this gets spent on my car, as I put up a lot of work mileage. I pay more tax, I have almost €1000 going out each month against my debts. All told I don't have much more left at the end of the month than he does. 
I do appreciate however that in the long term my prospects are better - my debts will be paid eventually, I have a reasonably good career. 

Yes we are registered with the PRTB, but no we are not covering the full mortgage, only the €850. Just to note we met the bank to explain the situation earlier this year, and we opened a case to reduce the repayments to €850 for a limited time. Their representative at the time advised us to pay the €850 by debit card for the time being, and to cancel the DD. They took 3 months to review the case and only rejected it in late April. They called last month and this month for an update and I've advised them that we're working on trying to find a resolution. 

My rent at the min is 950, split with my gf so 475 for me. 
His rent is 850, split with his gf so 425.


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## Ezdezat (14 Jun 2013)

Bronte said:


> You are now implying that you're going to make the situation even messier, by hiding money and all sorts.


 
I should mention also that i am not intentionally trying to make the situation messier. I am willing to pay my fair share, but my expectation would be that the other party should pay what he can reasonably afford. If i have to hide savings so that i don't lose everything into negative equity, then so be it. 
My gf and I are intending to get married and start a family in the forseeable future, I can't afford to pump more than my fair share into a bad investment. If my fair share turns out to be 65:35 due to my higher earnings, i can accept that, but not 100%.


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## Dr.Debt (14 Jun 2013)

OP, The 1st thing you must do when considering this type of situation is  understand the relative strengths and weaknesses of both the Debtor and  the Creditor.

What does the bank want ?- It wants you to pay in  full every month for the remaining life of the loan. If this happens  they will get all their money back and earn interest from you for 35  years.

What does the bank not want ?- The bank will not want to  crystallize a loss on this mortgage. If you surrender the property to  the bank voluntarily or you go bankrupt
the bank stands to lose  between 120,000 and 160,000 possibly more. It is in their interest to  keep this mortgage functioning for as long as possible. Remember this.  Its very important.

Now, If I was your Advisor, I would write to  the bank on your behalf. I would spell out the respective and different  financial positions of you and your friend and emphasize that one of you  is no longer in a position to meet the monthly payments. I would then  explain to the bank that I am advising you in relation to your options  including voluntary surrender, the new personal insolvency act and  bankruptcy. You then go on to suggest that the ideal solution for your  clients would be to pay a reduced monthly payment each month of 1020,  for a five year period with a proviso that the arrangement will be  revisited earlier if your friends financial position improves in the  meantime. You ask the bank to consider this proposal and if not  acceptable you will consider some of the other options available.

All  of this lets the bank know how you are thinking and quite frankly it  would be absolutely foolish of the bank not to accept it. They may  impose one or two conditions of their own and that's to be expected.

Now  my question to you. Why do you think the bank will not go for it ? What  can they do ? Repossess the house ? ( the bank certainly does not want  that) Push you into bankruptcy ( it doesn't want that either). The  interest is being paid in full and you are paying off a small bit off  the capital each month. The reduced payment is only 200 euro per month less.  Ive been dealing with banks all my life at a senior level. They are not  stupid, they understand risks and any decisions that they take will be  carefully weighed up.


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## TableEnd (14 Jun 2013)

Surely if he is paying out that much in rent he should be the one that moves back into the house?


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## Dr.Debt (14 Jun 2013)

One thing I forgot to mention.

You also need to consider your credit rating especially if you intend to apply for a mortgage again in the future. Such a propsal is likely to affect your credit rating for a number of years so you also need to consider that. Given that you are carrying such a large burden of negative equity, your chances of getting a separate new mortgage are slim enough anyway so this may not be too relevant.

Nonetheless, Putting a dent on your credit rating for the sake of 200 per month is something you must give some thought to.


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## Ezdezat (14 Jun 2013)

@ Dr. Debt. 
Tks for this info it is very helpful. 
I would have expected the bank not to go for it, as in my experience banks and similar institutions have very closed parameters, I have not been able to find any cases where they allowed such arrangements, where both parties were in employment etc. From my research - if the bank feel you can jointly afford the mortgage, they expect it to be paid, end of. Although maybe they are becoming more flexible here. 

I would like to preserve my credit rating, but it's not top priority. If I'm financially better off by losing it, then so be it. Due to the negative equity I'm unlikely to get another mortgage anytime soon anyway. I can save for anything else and i have credit card / credit union for emergencies. 

Two last questions if you don't mind;
1) I have struggled to find who best to talk to in these matters - solicitors / accountants / financial advisors? Who is best? FA's seem to be more about advising you on what insurance to buy. What type of advisor should I be looking for? Or do i need one at all?
2) Is the proposition in your 2nd post not different to that of your 1st? In your 1st you proposed a split mortgage, in the 2nd you were proposing a reduced payment for 5 years. Is this the same thing? 

@ TableEnd
He is paying 425 rent but we receive 850 rental income (425 each) anyway, so it would be of no benefit for him to move back in.


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## Dr.Debt (14 Jun 2013)

@EZDEZAT

The proposal is the same. Its basically a split mortgage. A portion of the mortgage is being deferred until a further date.

I don't think you can say that a Solicitor or Accountant or Financial Advisor is the right category of person to employ. You need a good negotiator and someone who understands banking inside and out.

And by the way, of course the bank's opening line will be "No, it cant be done" but that's what negotiation is all about. You both start from an extreme position and come together through agreement.

The big mistake that I see  all the time is that Debtors are too quick to accept the bank's position. The bank is only looking after its own interests. Its up to you to protect yourself from anything that is unfair or unreasonable. In days gone by, there was a general feeling that the bank was on your side and there to help you. Those days are long gone. The bank is working in its own interests ALWAYS.


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## Ezdezat (14 Jun 2013)

Dr.Debt said:


> @EZDEZAT
> 
> The proposal is the same. Its basically a split mortgage. A portion of the mortgage is being deferred until a further date.
> 
> ...



Tks, this is definitely an avenue I will explore. I have been reluctant to approach an accountant due to the fees. After a quick look online it can cost 1000's to have a practitioner act on your behalf. I may look at tackling it alone, I have some negotiation experience though never in this capacity. 
The actual figures I will need to look at in more detail, again if I contribute for 5 yrs and he doesn't, we would need to agree on the future share of equity in the property. 
Again as you rightly point out, maybe me covering the full repayments to preserve my credit score is not such a bad idea, if we can agree on a future equity share.


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## Dr.Debt (14 Jun 2013)

Finally, something that some people overlook in this type of situation, involving a jointly and severally liable loan - where one of the debtors satisfies the debt on his own, because the 2nd debtor is unable to do so, then the 1st Debtor can enforce a claim against the 2nd debtor and seek a contribution in compensation.

So in plain English, if you pay more than your share of repayments , then at the time of selling the house OR if the 2nd Debtor comes into money, there is a legal remedy
for you to recoup the excess paid, from the 2nd debtor.


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## Ezdezat (14 Jun 2013)

Dr.Debt said:


> Finally, something that some people overlook in this type of situation, involving a jointly and severally liable loan - where one of the debtors satisfies the debt on his own, because the 2nd debtor is unable to do so, then the 1st Debtor can enforce a claim against the 2nd debtor and seek a contribution in compensation.
> 
> So in plain English, if you pay more than your share of repayments , then at the time of selling the house OR if the 2nd Debtor comes into money, there is a legal remedy
> for you to recoup the excess paid, from the 2nd debtor.


 
Even while you have put forward some good ideas, thinking about it, a split mortgage or reduced payment plan is just kicking the can down the road. Sure we may have more money to spend now, but it will take a lot longer to bring the house back to positive equity. We could potentially have the same issue in 5 years time. 

Here's to hoping house prices recover, quickly. I won't hold my breath.


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## Importer (14 Jun 2013)

Well, thats what all mortgages are, kicking the can down the road because you cant pay the full amount now.

Sometimes the can is kicked down the road 20 years, sometimes 30 years and sometimes even 35 or 40 years.

I cant see the huge problem in your case if the can is kicked down the road 
an extra couple of years if it fixes your immediate problem


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## Ezdezat (14 Jun 2013)

Indeed! Although I do hope to get out of this situation, sooner rather than later! I appreciate I'm going to have to rent with my gf for a long time, but i would like to think that by the time I'm 40, there may be some light at the end of the tunnel! Some of the capital paid off, house prices rising a little, some savings built up. 

To that end i have one last question of people and i'll close the thread! By the way everyones input has really helped to explore the options, and it's much appreciated!

From a pure finance point of view - if i could come to agreement with my friend that any extra i pay i can try to recover from the equity down the line - would it be better to go with a revised payment option where i pay an additional 200 on top of the rental income? 
Or would it be better to try to pay the full 400 shortfall myself, and meet the full repayments? My thinking being that this may be the better option as it would reduce the capital owed more quickly? I do think i could afford the full €400, particularly when my credit card & loan is cleared it would be no problem.


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## Lucuma (14 Jun 2013)

So you're willing to pay 400 per month til the house comes back into equity, and what you want in return for that is to be entitled to as much of that equity as possible.

Sounds awfully like Option 1 ;-)


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## Ezdezat (14 Jun 2013)

Lucuma said:


> So you're willing to pay 400 per month til the house comes back into equity, and what you want in return for that is to be entitled to as much of that equity as possible.
> 
> Sounds awfully like Option 1 ;-)



When you put it like that  
Although the way I would put it - I'm willing to pay 400 per month until such time that the other parties financial situation is such that he can also start to contribute. A 30 yr mortgage is a long time and there is every possibility that could happen!


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## TrebleT (27 Jun 2013)

I'm sorry but if the mortgage is 1250.00, rental is 850.00 then you and your friend only have to come up with 200.00 each for the shortfall surely he can afford that?
He seems to have smaller debts the you so I think finding 200.00 would be pretty easy for your friend...sounds like he is trying to pull a fast one having you pay everything and he will reap the benefits down the line.


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## Ezdezat (8 Jul 2013)

TrebleT said:


> I'm sorry but if the mortgage is 1250.00, rental is 850.00 then you and your friend only have to come up with 200.00 each for the shortfall surely he can afford that?
> He seems to have smaller debts the you so I think finding 200.00 would be pretty easy for your friend...sounds like he is trying to pull a fast one having you pay everything and he will reap the benefits down the line.


 
There's some merit in what you're saying alright. I've kind of come to the conclusion though that that's just the way he is, and am trying not to take it personal. I am the type that pays all my bills in full every month and live on what's left. He's the type that tries to keep his outgoings low so he can have a better social life. I can't change him unfortunately...


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## Ezdezat (8 Jul 2013)

To update a bit on this situation. We had agreed to go with Dr. Debts tact, basically we propose to the bank that i pay exactly half of everything, and request that they 'park' his part of the mortgage. Everything is ready to go - cover letter, bank statements, SFS, etc. In the meantime, the other party has been advised his temporary employment contract will not be renewed. 

However, having calmed down a bit, I am now strongly considering taking on the mortgage, in full, myself. It will cost me €400 per month approx, but eventually I will have a house to show for it. I will be in control, I can protect my credit rating. A €400 outlay each month will be tight, but it won't be forever, I expect my earnings to go up, my unsecured debts will decrease over time, I expect rental rates will eventually increase a bit. We have good tenants in who look likely to stay there for a long time. Myself and my gf can rent until such time we're in a position to buy again, we're still relatively young. 
My friends situation isn't looking likely to improve any time soon, so keeping him involved while I will be liable for the lions share anyway, isn't a great option. I suppose it could be worse - at least I have benefited from him taking half of the costs to date, rather than if I had bought on my own initially (the initial costs & deposit, furnishing the house, etc.). We've both put about 20k in each so far. 

Before I pursue this avenue further, just some further questions, all opinions welcome, some people may have experience in similar circumstances;

1) How likely are the bank to sign the house over to me? Would i have to threaten not to pay until the issue of ownership is resolved, to get this to happen? Would this be an expensive process - would the bank try to drawdown a completely new mortgage (i expect at a higher 'buy to let' rate)? Solicitors fees? Stamp duty? Would the arrears be an issue? (about 3k at present i think). I don't have heaps of cash knocking about i can throw at this, and ideally would like to hold onto my small savings as a bit of a 'cushion'. 
2) Would it be better to see a solicitor and have a side agreement drawn up, where my friend agrees to forfeit his share of the equity, provided i take on the costs from this point? I could then look at having his name removed from the mortgage / deeds at a later date, when my financial situation has improved? How legally binding would this be?

Just to note, as far as i'm aware my friend would be only delighted to get out of this mess scott free, so I'm sure will sign anything that allows that.


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## Lucuma (8 Jul 2013)

Back before my ex went totally hostile on me, we submitted an application to have the mortgage transferred solely into my name. All it involves is printing off the forms, both of you signing it, and attach some financial information about your income etc. It is simple to do, and costs nothing. In our case she was earning nothing, was on social welfare etc and I had a good salary etc however the bank turned the application down. I believe this was because to date the mortgage had been paid in full and on time every month so the bank had no reason to want to change the status quo. In your situation, the mortgage is already in arrears, I'd say that will help your case. The bank don't want the current situation to continue like they did with me, and will be more open to talk options. No harm in filling out the forms and sending them off anyway, worst thing that can happen is the bank says no and then you can threaten to stop paying even the rent off the mortgage unless they agree to transfer the mortgage into your name. Have a look at some of the advice given to me on my thread, it applies here.


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## Ezdezat (8 Jul 2013)

Lucuma said:


> Back before my ex went totally hostile on me, we submitted an application to have the mortgage transferred solely into my name. All it involves is printing off the forms, both of you signing it, and attach some financial information about your income etc. It is simple to do, and costs nothing. In our case she was earning nothing, was on social welfare etc and I had a good salary etc however the bank turned the application down. I believe this was because to date the mortgage had been paid in full and on time every month so the bank had no reason to want to change the status quo. In your situation, the mortgage is already in arrears, I'd say that will help your case. The bank don't want the current situation to continue like they did with me, and will be more open to talk options. No harm in filling out the forms and sending them off anyway, worst thing that can happen is the bank says no and then you can threaten to stop paying even the rent off the mortgage unless they agree to transfer the mortgage into your name. Have a look at some of the advice given to me on my thread, it applies here.



Tks, that's an awful pity, you could have had the whole situation resolved if the bank had played ball? Amazing that being in arrears gives you a bargaining chip. 
I spoke to the bank earlier, i explained that the arrears were due to an ownership dispute and not about my ability to repay, and they said they would certainly consider it. In the guys words 'it has been done', and is called a 'transfer of equity', and doesn't cost anything. I suspect there are legal costs however. 
I also found a solicitor who seems to know what he's talking about, and advised that if the bank refuses to play ball, he can arrange a 'transfer of ownership', which would be legally binding. All pending the other party being willing to sign the dotted line of course.


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## Lucuma (9 Jul 2013)

Ezdezat said:


> Tks, that's an awful pity, you could have had the whole situation resolved if the bank had played ball? Amazing that being in arrears gives you a bargaining chip.
> I spoke to the bank earlier, i explained that the arrears were due to an ownership dispute and not about my ability to repay, and they said they would certainly consider it. In the guys words 'it has been done', and is called a 'transfer of equity', and doesn't cost anything. .


 
Yes, back then my ex wanted off the mortgage so she could apply for a council house (you can't get social housing if your name is on a mortgage) but we were turned down at the time I think because the mortgage was not in arrears. I think you'll find the best move you ever made was to let your mortgage get into arrears, it gives you so much more options with the bank. At the time that we applied, I had nothing to offer the bank to persuade them to hand the mortgage over to me, now that I have a lump sum saved up to offer them.....the ex has decided not to play ball. Murphy's Law. 

Regarding the legal costs yes I believe that in the event of the bank agreeing, your friend agreeing and all being set to go, you have to get a solicitor involved and pay a fee, although I think only a few hundred euro? I'm not sure though.


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## Lucuma (17 Sep 2013)

Hi Ezdat, just wondering if you continued allowing your salary & savings in same bank as your mortgage after going into arrears? There's no way they could seize part of your salary or savings to pay the mortgage is there?


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## Ezdezat (29 Sep 2013)

Lucuma said:


> Hi Ezdat, just wondering if you continued allowing your salary & savings in same bank as your mortgage after going into arrears? There's no way they could seize part of your salary or savings to pay the mortgage is there?



Hi Lacuma, sorry haven't been on in a while. State of play on this is that I've applied for a transfer of equity (into my name), currently waiting on the bank to respond. The tact I've taken with the bank is it's either they do that or they'll have to force a sale or repossess, as I'm not going to solely pump money into a property that the other party would have a claim to. So if they don't agree I'm sure I'll find out the answer to your question! Currently they have full visibility of my salary, but not the savings. 
Sorry probably doesn't help you...


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## Bronte (30 Sep 2013)

Ezdezat said:


> I also found a solicitor who seems to know what he's talking about, and advised that if the bank refuses to play ball, he can arrange a 'transfer of ownership', which would be legally binding. .


 
That's very interesting, I wonder how that works?

I do agree that being in arrears is a better bargaining chip with a bank.  When the mortgage is being paid on time they have no reason to agree to anything.  Arrears tends to focus their minds.


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## Ezdezat (1 Oct 2013)

Bronte said:


> That's very interesting, I wonder how that works?
> 
> I do agree that being in arrears is a better bargaining chip with a bank.  When the mortgage is being paid on time they have no reason to agree to anything.  Arrears tends to focus their minds.



It was a couple of months ago now I can't remember exactly what he said, but it was some kind of personal legal agreement between both parties, that would mean that although we are both jointly liable for the mortgage, he could hold me liable for his share if it ever came to it, in return for him relinquishing his interest in the house. Solicitor seemed to think it wasn't a problem - whether it would hold water in 20 years time if there was a dispute, I don't know, I haven't had to examine that option yet!


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