ex wants to buy me out of an investment property. No neg equity. UK based

Hi all,

Hoping someone can help advise what the best thing for me to do is.

I bought a house in 07, with my now ex for 87k, we owe 84 still.

He wants to buy me out which is great, though the houses average value from 3 valuations is 82k. The mortgage is in 2 parts. 76k mortgage and 6k secured loan against the house. We got it at the time of 100% mortgages.

I really want to be off the mortgage, but at the same time don't want to walk away with nothing. The house was a shambles when we bought it, so renovated it with the help of all my family so we didn't pay any labour, the house has sentimental value for this reason and this is one of the reasons I don't want to just walk away after all the hard work my family did. Also Over the past 6 years I have paid 15k personally and him another 15k off the mortgage. The furniture in the house we bought together.

Currently neither of us live in it as it's rented out. I'm just unsure what to do as he is bugging me weekly to sort it but I don't want to leave with nothing though is it possible I can ask him to buy me out for more than the valuation?

Thank you in advance for your replies.

You are so lucky he wants to take over this property. Don't look at what you've spent, it's gone. Be happy to get rid of it. And move on. Without regrets.

Agree fully with Bronte

You have an asset which is worth €82k. It is irrelevant now, whether that asset cost you €40k or €400k. Today it is worth €82k and your half is worth €41k.

While the house may have sentimental value, a house jointly owned with an ex can have huge negative sentimental value. If you start fighting, it will be very difficult to sort out. If he stops paying or if the tenant stops paying rent, your credit record gets damaged.

The existence of a mortgage on an investment property will reduce the amount you are able to borrow if you want to buy another home.

Is he proposing to take over the mortgage? Has the lender approved the transfer of the mortgage into his sole name?

Is the mortgage a tracker mortgage? If so, it's likely that the rent well exceeds the interest cost the mortgage, so the package of a house funded by a cheap mortgage may be worth something. If it is, give the interest rate and I will suggest a value.

Thank you both for your reply. You're right I should count myself lucky.

The mortgage is a tracker with alliance and Leicester 1.99% above BOE base rate.

I found out the exact this morning off the bank and the redemption figure is 81,448.08.

The rent exceeds the mortgage payment by 160 a month.

He is taking the mortgage on with his brother.

Thank you again

Hi Lou

This is an Irish website, but the principles should be the same.

While the rent exceeds the mortgage payment, the mortgage payment includes an element of capital, so this could be a very profitable investment. You should do the following calculation:

Rent received
Less interest paid
Less other costs
= profit

Who manages the property?

Overall, I would think that you are well rid of it. But could you make a counter offer to buy him out?

Thank you when you say rent received do you mean monthly? less the 2.49% interest?

I'm not sure I would want to buy him out as I live abroad. The property is managed by a letting agent.

It's easier to do it annually. The interest on £81,500 @ 2.5% is around £2,000 a year.

If it's managed by a letting agent, what fee to they charge?

Oh ok, they charge 7%

Lou25jm said:

I'm not sure I would want to buy him out as I live abroad. The property is managed by a letting agent.

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I really think you're better off cutting all ties. It's really difficult to manage property from abroad, even if you've a letting agent.