Co-owner refusing to make payment and wants half the equity.

[Byryd]

What is the name of your state? Michigan

In 2000 I purchased a house and put my girlfriend on the deed/mortgage. She wants half the equity in the house after verbally agreeeing she would sign off if I let her take everything off the property and from the home she wanted. She literally took every piece of furniture/exercise equipement/picture and everything outside. The house is now bare. I also signed a car over to her as part of the agreement and she has never contributed to a house payment or utility bill since she lived there. I approached her with a quit claim form and she countered with "Give me $20,000.00 dollars." I put $36,000.00 down from a house I owned prior to her and she believes she is entitled to half of that money as well. I had the house appraised and they said it was worth around $139,000.00 because it is unfinished, as I was in the process of remodeling. We owe $110,000.00 on the house.

Here are my questions: 1) Is she entitled to any of the money I put down on the house?
2) Can I make her pay half the rent until she signs off or we sell?
3) Is she responsible for half repairs neede on the property?
4) Am I entitled more of the Equity due to making every payment?
5) Do I get the extra money I sent in every month towards the
prinicipal?

[Zigner]

Originally Posted by Byryd

I purchased a house and put my girlfriend on the deed/mortgage.

For anyone else even THINKING of doing this...don't.

[divgradcurl]

1) Is she entitled to any of the money I put down on the house?

Since you are not married, probably not.

2) Can I make her pay half the rent until she signs off or we sell?

You can ask her, but you cannot compel her without a court order.

3) Is she responsible for half repairs neede on the property?

This depends on what agreements (in writing) you have with her.

) Am I entitled more of the Equity due to making every payment?

Not really. A rule of thumb is that when a house is co-owned and sold, both parties are entitled to reimbursement -- so, after the mortgage was paid off, you would get reimbursed for the down payment, and get reimbursed for principle payments, then whatever is left gets split equally. But that's just a rule of thumb -- if she can prove that she did something else in lieu of making payments, or that you guys had some sort of agreement that should wouldn't pay half, then this division will likely be modified to suit the circumstances.

EDIT: You will not get reimbursed for interest paid on the loan, property taxes, insurance, or needed repairs. You may be able to get reimbursed for expenses related to improvements to the property.

5) Do I get the extra money I sent in every month towards the
prinicipal?

Maybe, see above.

Plus, if the house has dropped in value since you bought it, your "contributions" may be reimbursed at a pro-rate level instead of their full amounts.

All of this is what a court would come up with if you can't figure this out on your own.

She wants half the equity in the house after verbally agreeeing she would sign off if I let her take everything off the property and from the home she wanted.

Too late now, but next time, get everything in writing, or it didn't happen.

[seniorjudge]

What you need to do is either get this settled between the two of you


OR


file a partition suit and have the court sell the land on the courthouse steps. If there is any profit, y'all would split it however the court decides.

(Partition suits run about $20K and last three years ... if they are cheap and quick.)

[Byryd]

I really appreciate the advice. I have tried for the past 3 months to settle this with her and even offered more cash then she was lawfully entitled. But, she refuses to negotiate because her new boyfriend went through a divorce and is telling her she will get half of everything I own. I tried to explain to her that their is no commonlaw in Michigan (Abolished Jan. 1st, 1957) but she claims her Lawyer is telling she will get half of everything as well. Get this, she called yesterday to leave this message: "I'll need you to list all the cars you have because I need to know what they are worth so I can get my half."

[LindaP777]

Sorry, but it sounds like you very fortunate to have already gotten rid of the worst part of this whole thing ~ the ex-gf!

[lwpat]

In this case you may be better off to simply walk away from it and let the bank foreclose or she can start making the payments since she is on the mortgage. This will ruin your credit but is probably your cheapest and quickest way out. Be sure the mortgage company has her new address and have them send the bills to her. Why would you sign over the car and let her take the stuff without settling everything else? She has no right to half of anything but the house. Ignore her.

[HomeGuru]

Originally Posted by lwpat

In this case you may be better off to simply walk away from it and let the bank foreclose or she can start making the payments since she is on the mortgage. This will ruin your credit but is probably your cheapest and quickest way out. Be sure the mortgage company has her new address and have them send the bills to her. Why would you sign over the car and let her take the stuff without settling everything else? She has no right to half of anything but the house. Ignore her.

**A: bad advice. Can the ususal contributors of this forum tell us why?

[FarmerJ]

letting a property go to foreclosure is not a wise choice , IF for some reason it sells for way less than what the lender needs then your still stuck for the balance Instead of ignoring her go talk to a real estate atty to learn what it will take to start a partition suit. BTW you will get credit for all the payments you had to make by your self. As far as the personal property she took discuss it with the atty. If that house has a chance of improving in value in the next few years with it being finished you very well might be wiser to keep it. BUT do speak to a real estate atty and learn all your options.

[HomeGuru]

good keep it up. Thanks FJ.

[Byryd]

I will not let the bank foreclose, as I have excellent credit. The house will be worth 20% - 30% more once fully finished, according to the appraiser. However, I won't touch it until this is over. I meet with her and the Attorneys in a few weeks. I have pulled all my bank records to show I made every payment for the last 7 years and have all my personal credit card statements for everything I let her take. I was trying to be nice in giving her everything she wanted, not knowing her real motive, my mistake. I'll keep all of you updated as it unravels. I'm off to the child custody forum, as this gets deeper !

[lwpat]

HG usually I would agree. Here he is facing a choice of evils.

He can pay her 20,000 and move on. Based on the phone call she may not even accept that now.

He can keep making payments on the mortgage and start a suit for partition. This will probably run a minimum of 5000 and possibly as much as 10,000 in legal fees and could take two to three years depending on the case load and if she wants to delay. He may or may not get credit for payments while they were together. She will certainly claim everything was a gift. He would get credit for payments after they split. He will have to expend more funds finishing the remodeling but should get credit for that also. Then the court will order the house sold at the courthouse door just as if there was a forclosure so he is still looking at the possibility of it not selling for the amount of the loan unless he bids it back in.

He can let it go to foreclosure. This may bring her to the table since they are both on the mortgage. I have seen cases like this where the bank will agree to let him bid on the house and then refinance in his name alone. Or he may have someone else that could bid it in for him. The bank is only looking for their balance plus the costs of sale. The problem is that this will ruin his credit along with hers and will follow him for seven years. Once she knows this is what is going to happen, she may be more agreeable to a settlement.

Bottom line is that he does not have any good options. If there was more equity in the house I would absolutely agree with a suit for partition.

[HomeGuru]

Originally Posted by lwpat

HG usually I would agree. Here he is facing a choice of evils.

He can pay her 20,000 and move on. Based on the phone call she may not even accept that now.

He can keep making payments on the mortgage and start a suit for partition. This will probably run a minimum of 5000 and possibly as much as 10,000 in legal fees and could take two to three years depending on the case load and if she wants to delay. He may or may not get credit for payments while they were together. She will certainly claim everything was a gift. He would get credit for payments after they split. He will have to expend more funds finishing the remodeling but should get credit for that also. Then the court will order the house sold at the courthouse door just as if there was a forclosure so he is still looking at the possibility of it not selling for the amount of the loan unless he bids it back in.

He can let it go to foreclosure. This may bring her to the table since they are both on the mortgage. I have seen cases like this where the bank will agree to let him bid on the house and then refinance in his name alone. Or he may have someone else that could bid it in for him. The bank is only looking for their balance plus the costs of sale. The problem is that this will ruin his credit along with hers and will follow him for seven years. Once she knows this is what is going to happen, she may be more agreeable to a settlement.

Bottom line is that he does not have any good options. If there was more equity in the house I would absolutely agree with a suit for partition.

**A: read the OP's post above yours.