Its been 7 years... Now she want the house

[Bali Hai]

Geeze....I am glad my ex didn't get advice from this forum...LOL

He split 3 months after we bought the house so there was NO equity....in fact, a partition would have cost BOTH of us signficant bucks. Our loan was FHA...we came out of closing owing more than the FMV of the home.

I refinanced 3 or 4 years later and he didn't have a single problem with signing a quit claim at that time. I maybe should have done it sooner but neither of us even though of it until that first real drop in interest rates (thats why I refied....we bought when standard interest rates were 10 3/4...and that was back when 8 1/2 was a BIG DEAL). If we had had any equity when we split up I would have felt that something was due to him, but we sure as heck didn't.

Of course he paid child support...he felt it was his responsiblilty to do so but would never have considered that the fact that he paid child support meant that he paid my mortgage..

Of course we didn't divorce until about 8 years after we split up, and had totally divided our financial lives long before then (he had purchased a house too)...and neither of us would have ever DREAMED of trying to profit from the other at the time of divorce.

I don't see this case as being any different. If there was equity when they split then he is entitled to something....and some interest/appreciation on that equity since he could have used the money to invest in something else had they handled it at the time of divorce.

However, expecting him to get 50/50 when he didn't contribute to the mortgage or the upkeep is patently unfair....and would be patently unfair if the roles or genders were reversed.

As Nextwife has so aptly stated, HIS money was tied up in the house that she was living in.

I don't know of ANY landlord that would allow a tenant to live free for 7 months. She has been living free for 7 years!

And now she has the gall to want HIS share of the property to start a new life with another man?!?

 

[LdiJ]

As Nextwife has so aptly stated, HIS money was tied up in the house that she was living in.

I don't know of ANY landlord that would allow a tenant to live free for 7 months. She has been living free for 7 years!

And now she has the gall to want HIS share of the property to start a new life with another man?!?

I totally disagree with this whole "tenant" argument. A landlord bears the responsibility for the mortgage and upkeep on a home. A landlord depreciates the home and must pay capital gains taxes on all profit and recaptured depreciation when the home is sold. A landlord must pay taxes on any rental income. A landlord gets no benefit from any exclusion....which this gentleman will get since selling the home is part of a marital property settlement...he gets the benefit of HER residency.

On top of that, any net return on rental property is incredibly small unless the mortgage is a very old one or unless there is no mortgage.

Does he deserve a reasonable return on his original investment?...absolutely. Does he deserve 50% based on the "tenant" argument? Absolutely not, unless he is held responsible for the fulls costs that would have been born by a landlord, including paying captial gains taxes (with depreciation recapture) and taxes on rental income.

 

[nextwife]

I totally disagree with this whole "tenant" argument. A landlord bears the responsibility for the mortgage and upkeep on a home. A landlord depreciates the home and must pay capital gains taxes on all profit and recaptured depreciation when the home is sold. A landlord must pay taxes on any rental income. A landlord gets no benefit from any exclusion....which this gentleman will get since selling the home is part of a marital property settlement...he gets the benefit of HER residency.

On top of that, any net return on rental property is incredibly small unless the mortgage is a very old one or unless there is no mortgage.

Does he deserve a reasonable return on his original investment?...absolutely. Does he deserve 50% based on the "tenant" argument? Absolutely not, unless he is held responsible for the fulls costs that would have been born by a landlord, including paying captial gains taxes (with depreciation recapture) and taxes on rental income.

First, many LLs sell without current exposure to capitol gains, by running the proceeds through a 1031 exchange and deferring the gains (qualified intermediary cost, in my market, is about $300). i've seen gains deferred property to property until death.

SEcond, it is not just his money but his borrowing power that was tied up by the open mortgage. An open mortgage impacts one's credit score adverseley and reduces the amount of home loan they can get to obtain their own place- inless it truly is a rental property that generate income to offset debt oobligation.

Try this:

X years of his half of her payments/maintenace (not housecleaning, decorating to taste or gardening, which are optional and quality of living expenditures) that he did not pay, deducted from proceeds.

X years of market rents that could have otherwise been recieved, divided by two. His half share of rental value deducted from what he didn't pay toward mortgage,

The difference adjusts his half share of proceeds?

 

[LdiJ]

First, many LLs sell without current exposure to capitol gains, by running the proceeds through a 1031 exchange and deferring the gains (qualified intermediary cost, in my market, is about $300). i've seen gains deferred property to property until death.

SEcond, it is not just his money but his borrowing power that was tied up by the open mortgage. An open mortgage impacts one's credit score adverseley and reduces the amount of home loan they can get to obtain their own place- inless it truly is a rental property that generate income to offset debt oobligation.

Try this:

X years of his half of her payments/maintenace (not housecleaning, decorating to taste or gardening, which are optional and quality of living expenditures) that he did not pay, deducted from proceeds.

X years of market rents that could have otherwise been recieved, divided by two. His half share of rental value deducted from what he didn't pay toward mortgage,

The difference adjusts his half share of proceeds?

Very few people do section 1031 exchanges unless they are actively involved in in real estate as a form of making their primary living. Your equation does not take into consideration taxes on rental income nor capital gains and depreciation recapture....nor does it take into consideration the normal amount ordinary expenses involved in renting property nor the normal periods between tenants.

Again....I don't buy the entire "tenant" argument. I agree that he is entitled to 1/2 of the equity in the home at the time of the divorce, plus a reasonable return on his investment.

 

[sylviat]

She was in such a hurry to get with the man she married which is the reason for the divorce.... so we did not have any property settlement. I gave her everything, but a picture that was a present, a TV and a stereo. We Both took our own cars. I'm fine if we settle when the twins get out of school. How should I Offer to settle this then.
Thanks Again
chris1759

I have a question/remark about this post: If he gave her everything at the time of divorce, he is still able to go back 7 years later and talk about doing something with the house? I thought that once you divorced that was it. I didn't know you could go back and get more. Can that happen?

 

[BelizeBreeze]

I have a question/remark about this post: If he gave her everything at the time of divorce, he is still able to go back 7 years later and talk about doing something with the house? I thought that once you divorced that was it. I didn't know you could go back and get more. Can that happen?

No, of course not. That's why we've been telling him to do it. We like to mess with people's minds that way.

 

[chris1759]

I SAID THERE WAS NOT A PROPERTY SETTLEMENT, BUT I LEFT EVERYTHING FOR HER (1STEREO 1TV)

I have a question/remark about this post: If he gave her everything at the time of divorce, he is still able to go back 7 years later and talk about doing something with the house? I thought that once you divorced that was it. I didn't know you could go back and get more. Can that happen?

 

[chris1759]

I SAID THERE WAS NOT A PROPERTY SETTLEMENT, BUT I LEFT EVERYTHING FOR HER AND THE (1STEREO 1TV) SHE CAN'T DO ANTHING WITH THE HOUSE WITHOUT MY SIGNING OFF ON IT.

I have a question/remark about this post: If he gave her everything at the time of divorce, he is still able to go back 7 years later and talk about doing something with the house? I thought that once you divorced that was it. I didn't know you could go back and get more. Can that happen?

 

[moburkes]

Chris, stop yelling. It was only a question.

 

[DownInNY]

Hmmm...

I pay child support (in NY State), and I have read the laws several times. I have also gone to court over this several times. Child support is the amount that both parents pay to take care of the kids. Since one spouse keeps the kids, their "contribution" is not explicitly paid. However, at least in NY State, the entire amount to be paid by both is calculated, and the non-custodial spouse pays their pro-rated share explicitly.

My point? His child support was supposed to go for mortgage, food, clothing, etc. for the kids. He did in fact contribute to that mortgage. If you don't think so, start looking at the case law and talk to some judges.They don't differentiate between her share of the mortgage and the kid's share of the mortgage. Believe me, I've tried to fight this in court, because I know my ex uses my support to totally pay the mortgage (and then some... I pay a LOT of child support).

If your name is on the house, she can't sell it until you agree... she will profit from that sale (or from sole ownership), and the difference in equity is partially yours. Don't agree? Imagine if you hadn't paid support. Would she have been able to afford her current lifestyle, including the mortgage? Probably not.