Own A House With Boyfriend Relationship Over Question About Equity Division

[bigalcalbisque]

California,
Daughter & boyfriend bought a house together (did not prepare a buy-out contract, ignoring my advise), Title held as Joint Tenancy. Loan in both of their names. Boyfriend moved out, Had house appraised about 1 week later by a mutually agreed on appraiser (actually the Appraiser that appraised the home when they bought the home, non-biased). Daughter offered the boyfriend 1/2 the equity they have made minus a share of the closing costs should he force her to sell the property. In other words he would get the same money whether they sold the home or she bought him out.
She has an e-mail from him that states he is moving out and the date, that date has already passed and he has moved out. Daughter is now paying everything by herself. He refuses to accept the fair buyout amount. Should this not get resolved quickly, is he entitled to any equity build-up from the date he moved out onward into the future.
By equity I mean to include the possible increase of value over time and the normal monthly principle pay-down on the Mortgage that my Daughter alone is now paying.
I realize there could be other issues perhaps with the Lender but I just need an answer to this specific question.
Thank you so much to all that answer my question!
Al

 

[STEPHAN]

I don't see a question.

 

[bigalcalbisque]

This Was And Is The Question

Should this not get resolved quickly, is he entitled to any equity build-up from the date he moved out onward into the future.

 

[FarmerJ]

In order for him to truly have no interest in the property she needs a new mortgage to replace the current one just as if the property were sold to a total stranger . BUT if he wont agree to anything then perhaps she should be seeking a attorney to talk about partition suit. AS to the former BF if he has a easy way out of the property he should really take it since the housing market could in theory crap out again leaving the home to have even less value. ( does he also understand by keeping him self tied to the home if her situation becomes really bad he too would still be on the hook again for something that in the future could see a drop in value making it more impossible to sell ? )

 

[bigalcalbisque]

Maybe There Isn't An Answer To My Question???

In order for him to truly have no interest in the property she needs a new mortgage to replace the current one just as if the property were sold to a total stranger . BUT if he wont agree to anything then perhaps she should be seeking a attorney to talk about partition suit. AS to the former BF if he has a easy way out of the property he should really take it since the housing market could in theory crap out again leaving the home to have even less value. ( does he also understand by keeping him self tied to the home if her situation becomes really bad he too would still be on the hook again for something that in the future could see a drop in value making it more impossible to sell ? )

Thanks Farmer J, that is good advice and I appreciate your support. I am aware that there will be other items including possibly getting an Attorney and a new mortgage as my wife and I can co-sign for her. But forgive me if I am just being naive but I just wanted to know a simple answer to my only question that I posted.

THIS IS THE SPECIFIC QUESTION
"Should this not get resolved quickly, is he entitled to any equity build-up from the date he moved out onward into the future."

From my original post:
"I realize there could be other issues perhaps with the Lender but I just need an answer to this specific question."

 

[STEPHAN]

Questions end with a question mark ;-).

A buyout works differently. She needs to get her own financing and buy the property, so she is the only owner, and he is off the financing.

The bank will not release him from the existing loan.

If I were him, I would never agree to any other solution, as it is a ticking time bomb.

And yes, of course, he is entitled to 50% of the profit if the property goes up.

Another option would be to sell the property on the market.

 

[HRZ]

SHe is NUTS to seek a mortgage just in her name ..his equity is not eliminated and he has the right to go live elsewhere and for that matter rent out his occupancy rights to a complete stranger .. unless a rental,conflicts with local law...and right now he is on the hook as well as she is for the mortgage ....and he could insist that she pay him rent for his portion or he moves in a tenant .

And to cosign a note for family member is a good recipe for another set of problems .

A partItion suit is often a way to get a low price as they often attract bottom feeders ...but it is one way to cut the cord .

Your view that her offer to him is fair is not necessarily what he may have in mind ...

A binding internal auction with serIous locked in non refundable deposIts and requirement that seller sell and buyer buy might be one way to cut the cord ...I've seen it work ..and also fail because winning bidder used a back door exit and did not forefit serious money.

Personally I'd try a different route... like get it on open market.

 

[justalayman]

Should this not get resolved quickly, is he entitled to any equity build-up from the date he moved out onward into the future.

Yes he would be entitled to 1/2 of the equity of the property sale.

If there was an agreement tbey split the cost of the payments, she could seek an offset of 1/2 of the amount she has paid since he left or she can sue for same.

 

[latigo]

California,
Daughter & boyfriend bought a house together (did not prepare a buy-out contract, ignoring my advise), Title held as Joint Tenancy. Loan in both of their names. Boyfriend moved out, Had house appraised about 1 week later by a mutually agreed on appraiser (actually the Appraiser that appraised the home when they bought the home, non-biased). Daughter offered the boyfriend 1/2 the equity they have made minus a share of the closing costs should he force her to sell the property. In other words he would get the same money whether they sold the home or she bought him out.
She has an e-mail from him that states he is moving out and the date, that date has already passed and he has moved out. Daughter is now paying everything by herself. He refuses to accept the fair buyout amount. Should this not get resolved quickly, is he entitled to any equity build-up from the date he moved out onward into the future.
By equity I mean to include the possible increase of value over time and the normal monthly principle pay-down on the Mortgage that my Daughter alone is now paying.
I realize there could be other issues perhaps with the Lender but I just need an answer to this specific question.
Thank you so much to all that answer my question!
Al

What difference does it make as to the amount of equity in the home, whether its due to market conditions, reduction of the principle or whether her buyout offer is fair or not. Is it not a moot issue since the ex boyfriend is holding the trump cards?

You talk as if your daughter has some leverage here and it just a matter of her arriving at a figure. But she has no advantage or leverage. She can't force him to sell to her or anyone else. If she expects to keep the home and have him quitclaim over his undivided one half interest, she will need to meet his terms.

Either that or have it sold by a court appointed referee (by public auction or private sale) via a highly expensive and protracted action for partition where no one wins except the lawyers.

 

[LdiJ]

Thanks Farmer J, that is good advice and I appreciate your support. I am aware that there will be other items including possibly getting an Attorney and a new mortgage as my wife and I can co-sign for her. But forgive me if I am just being naive but I just wanted to know a simple answer to my only question that I posted.

THIS IS THE SPECIFIC QUESTION
"Should this not get resolved quickly, is he entitled to any equity build-up from the date he moved out onward into the future."

From my original post:
"I realize there could be other issues perhaps with the Lender but I just need an answer to this specific question."

Your question cannot be answered with a simple yes or no. If I ended up in court your daughter could certain sue him for the half of the mortgage and other expenses he did not pay. He can also argue that she got exclusive use of the property therefore it was just that she solely covered those costs.

Bottom line, legally: They both own 1/2 of the property and they are both legally liable to the mortgage company for the mortgage, and legally liable to the municipality for the property taxes. All of the rest is up for negotiation.

Your daughter has leverage because he is on the mortgage, and eventually that is going to be a problem for him. He probably doesn't realize it right now, but it will be a problem for him.

He has leverage because the longer your daughter pays the mortgage on her own, the more potential equity he is amassing.

Any resolution your daughter negotiates needs to include a refinance of the mortgage to remove him as well as a payout of his share of the equity. If his share of the equity at the moment is less than his share of the down payment, that might explain his current lack of cooperation.

 

[STEPHAN]

And keep in mind that he is an owner of the property, too. He could move in there anytime.

 

[justalayman]

And keep in mind that he is an owner of the property, too. He could move in there anytime.

And that is why he is liable for 1/2 of the costs of the property. Unless op actually excludes him, his choice to leave does not relieve him of his financial liability.

 

[Ohiogal]

California,
Daughter & boyfriend bought a house together (did not prepare a buy-out contract, ignoring my advise), Title held as Joint Tenancy. Loan in both of their names. Boyfriend moved out, Had house appraised about 1 week later by a mutually agreed on appraiser (actually the Appraiser that appraised the home when they bought the home, non-biased). Daughter offered the boyfriend 1/2 the equity they have made minus a share of the closing costs should he force her to sell the property. In other words he would get the same money whether they sold the home or she bought him out.
She has an e-mail from him that states he is moving out and the date, that date has already passed and he has moved out. Daughter is now paying everything by herself. He refuses to accept the fair buyout amount. Should this not get resolved quickly, is he entitled to any equity build-up from the date he moved out onward into the future.
By equity I mean to include the possible increase of value over time and the normal monthly principle pay-down on the Mortgage that my Daughter alone is now paying.
I realize there could be other issues perhaps with the Lender but I just need an answer to this specific question.
Thank you so much to all that answer my question!
Al

This isn't your business, Al. BUTT OUT. Let your daughter handle it. She will need to afford to refinance the loan on the house.

 

[Ohiogal]

Should this not get resolved quickly, is he entitled to any equity build-up from the date he moved out onward into the future.

Yep. He is half owner of the house. He is entitled to half of all equity.

 

[not2cleverRed]

Thanks Farmer J, that is good advice and I appreciate your support. I am aware that there will be other items including possibly getting an Attorney and a new mortgage as my wife and I can co-sign for her. But forgive me if I am just being naive but I just wanted to know a simple answer to my only question that I posted.

THIS IS THE SPECIFIC QUESTION
"Should this not get resolved quickly, is he entitled to any equity build-up from the date he moved out onward into the future."

From my original post:
"I realize there could be other issues perhaps with the Lender but I just need an answer to this specific question."

I'd say that one of the issues in offering an answer is... as Stephan observed, what is the question?

What does the ex-boyfriend want? Part of negotiating a resolution requires each side having a starting point, and working towards something somewhere between.