Ex Friend's name on my mortgage, now he wants to be taken off and compensated?

six years ago a friend of the family(no longer a friend) put his name on my mortgage as I had faced some problems and thought I would lose the deposit.

Clarification - his name was also on the deeds - Brendan

He has never been in the house nor has he contributed to the repayments. I solely been responsible for the repayments.

He has contacted me through his solicitor, he wants his name removed and he wants to issue court proceedings to have the house sold if I do not compensate him in some way.

Where do I stand?

Would a judge award him anything?

I live alone with my two daughters and do not want to lose my home but i do not want to be forced to re mortgage to pay him off either.......

Re: What is he entitled to?

As long as you can prove that you have solely made the payments and that he made no contriubtion whatsoever then a court should find in your favour.

There may be other (tax related) reasons why someone may be reluctant to go to court though.

As with anything legal don't take anyones advice here as gospel.

He has never even set foot in the house...ever like..I have paid everything for the last 6 years.

I dont' get the thing you said about being reluctant to go to court re: tax related issues.

He wants me to pay him or he will go to court to force the sale of the house. I don't want to have to remortgage to pay him money for nothing.... is court the better option ?

Re: What is he entitled to?

Is his name on the deeds as well , or just the mortgage ?

Did your friend pay any of the deposit? Speak to a solicitor is your best bet.

From your description of it, it seems that he has absolutely no claim.

He has not suffered any loss, so he can't be compensated for it.

Is the lender willing to take his name off the mortgage? Is your income high enough for the mortgage?

It sounds as if he is chancing his arm. He may be trying to frighten you into paying him something to go away. You should stand your ground and if you get any legal proceedings from him, get your solicitor to write to him stating clearly that you will be seeking your full costs if they proceed to a case.

As this situation is very unusual, it is likely that your friend or one of his friends would recognize the situation if they read this on Askaboutmoney. If you are happy with the replies you have got, I can delete the thread.

Brendan

I have spoken to a solicitor, she thinks I should remortgage and pay him off but I feel she's kinda pushing me into it I don't know what to do.

Re: What is he entitled to?

Is name is on both.

No the deposit was 5000 euro I paid it , all he has ever done is lent his name to the mortgage to enable me to get the house.

If he has never contributed any money to the house either by way of a house deposit or made mortgage payments towards it, I dont think that no judge will compensate him. He has a cheek to come after you for money anyway and maybe you should consider changeing your solicitor.

Certainly agree with the post above in that he has a cheek, given that he paid nothing. However, I am not sure that the law is that straightforward. I would get a second opinion from another Solicitor. The issue is that his name is actually on the deed, so technically he "owns" a share in the house.

he could be looking for you to stump a share of the profits from whatever time you bought the house till now, because he technically "owns" part of it.

You definitely have a problem and its a horrible situation to find yourself in, sorry for your trouble. Good luck with it.

You might be stuck here - imagine you happened to be lovers...and both names on the deeds/mortgage...one breadwinner...does the second person still deserve nothing? Im not sure I agree that he didn't suffer loss. If he lent his credit to you he would have lost his first time buyers grant as well as the freedom to buy another house while he built up equity.

Good luck though - definitely look for another solicitor. On the bright side - at least he's asking to get out of the property market at the bottom. Your valuation must be lower - the ability to borrow from the banks must be more difficult as well... the amount of money you can get for him will be considerably less. Peace of mind to buy off this ex-friend will be worth it. At least now you know how much as a person he is worth.

The fact that his name was on the deeds really does change it a lot.

If the house had fallen in value would he be liable for half the fall in value?

Legally, I suspect he would.


It was a most unusual arrangement and he might describe the arrangement differently. If you were a couple at the time, he might say that the intention was to buy a house together using your deposit and his credit rating.

Do you have a mutual friend or professional advisor who could act as arbitrator? What about the solicitor who acted for you in the purchase of the house? Is that the same solicitor you are using today?

Presumably you did not do an agreement before you bought the house? Or do you have any exchange of emails with him about the arrangement at the time?

Brendan

Get a good lawyer.

It does sound like he owns half the property. But even in the case that he can have a demand for settlement enforced, you should (i.e. it makes logical sense) be able to offset the deposit, all mortgage payments (capital plus interest), all maintenance and upkeep or improvement (plants, landscaping etc.). Then you should have the valuation legally defined as the that which will have it sold within 6 weeks, not delusional prices that 95% of sellers in Irelajnd are still asking for and waiting nearly a year to sell. Think of owning a company share - its proper value should be assessed as what it can achieve on the market now, not what it might get if you hang on long enough.

Do all that and you might even find that the net realisable value is zero. He might even owe you money. If you could do that you might be able to secure the deeds for nothing (and in a quite equitable way in my opinion), or to pay a more appropriate lower settlement that would be a more correct reflection of his financial interest today.

You definitely need good legal advice. Clearly he owns 50% of the property less the deposit you put up and the mortgage repayments (only the capital element I suspect but I could be wrong). The OP did say he wants to be compensated in SOME way which doesn't sound unreasonable to me as it doesn't suggest he's looking for the 50% share. Speak to a solicitor and try and get advice on how to come to an agreement.

pink30 said:

He has never been in the house nor has he contributed to the repayments. I solely been responsible for the repayments.

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Thinking about this a little more - there must be some defense of the OP here. I cant imagine any court would favour the "freind" in this situation. If the other person loaned the name - and they didnt look for any security/contract then I cant see how that person can force the sale of the house. If the OP was planning to sell anyway and this guy turns up at closing looking for cash thats different.

There must be some protection/rights of a person living in a house to carry on living there - free from this extortion. It certainly is an unusaul situation. Maybe the best advice was that of getting a third party to try and reach a deal between you. Maybe a very small amount will buy this parasite off.

It's all very well saying that the friend is a parasite as posted what happened if it was a couple and one was working and making the payments and the other paid nothing but had their name on the deeds?
Many housewifes are in the situation but obviously at least they lived there unlike the OP's friend. And yes, I know about protection of the family home

Get legal advice, it's not as simple as just saying he gets nothing. I'd be interested to know how this turns out

micmclo said:

...Many housewifes are in the situation but obviously at least they lived there unlike the OP's friend. And yes, I know about protection of the family home...

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yankinlk said:

... imagine you happened to be lovers...and both names on the deeds/mortgage...one breadwinner...does the second person still deserve nothing?

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Just to make a point that seems to be somewhat ignored here. In the case of a non-earning partner in the house, the likelihood that that person is not contributing at all to the household is very low. Generally a "housewife" contributes a large amount of unpaid labour to the upkeep of a family home and, for a married spouse, their tax credits contribute to the family disposable income. In this case it seems highly unlikely that the former friend contributed in such a fashion so I would disagree with drawing on them as a comparison in this case. The only justification, albeit a weighty one, this friend can raise is that their name is on the deeds and the mortgage, nothing else.

I really don't know what to advise but I personally would sooner go to court than to put up with his bullying tactics. I think he is trying to scare you by saying he will issue court proceedings, but given the circumstances I think this it is the only way to sort this out fairly and should be a good option for you also. He would appear to be under the impression that once he brings you to court things will go in his favour. He is being very cocky. I presume you have proof that you have been solely paying the mortgage all along and initial deposit. He has contributed absolutely nothing apart from his name and is trying to bully you into selling your family home. I really don't think your solicitor sounds all that helpful either. One thing that did pop into my mind though was whether he sacrificed his ftb status to help you buy this home? That might have a bearing on things. I am not a solicitor though so all of the above is just my thoughts.

In many years of general practice as a solicitor, I have long since come to realise there are always two sides to every story. When I meet my clients for the first time and they tell me their story, I hear one side and one side only. Months later down the line, the whole story comes out. About 50% of the time it is a very different story – seen now through reality eyes and not from the upset, emotive driven, poor me standpoint.

Having read the contributions , I am forming the strong view that perhaps what is happening here is that the Ex Friend now wants to move on with his life, he wants his name off the Deeds and his name off the mortgage – perhaps because he wants to buy a property of his own. Who knows? It may be that OP cannot get a mortgage for the full amount in their own names (notwithstanding that they have been solely responsible for the payments to date) and therefore cannot accede to the Ex Friends request that his name be removed from the Deeds. There are also horrible Tax implications for what happened here with potential CAT, Stamp Duty and CGT issues all arising. If Ex Friend and OP cannot work it out between them then do they have any alternative but to (a) sell house and (hopefully) clear mortgage ( which OP does not want to do) or go to Court -which no one will ever recommend but which is often the only alternative if one person will not sit down and work through the reality of the situation.

mf