Has anyone done a side deal with a joint owner to renounce their interest?

[Brendan Burgess]

Where joint owners have split up and one wants to take over the mortgage but the bank won't allow the other's name off the mortgage, it is often recommended to do a side-deal.

He renounces his interest in the property.
She agrees to make the repayments in full.

Has anyone actually done such a side-deal?

How legally effective is it?

Brendan

 

[mf1]

I'm not sure about this bit - "it is often recommended to do a side-deal."

There are pros and cons. Look at the cons first:

1. It is not a clean break so there is always the possibility of something, anything, going horribly wrong.

2. Is it legally effective? Possibly , but see above.
You can never stop people coming back whining later. Which is why the clean break is so much more preferable.

3. You still have the liability but without the asset.

4. You still have a mortgage.

5. You do a runner and the house is stuck in limbo in joint names,
I'm not sure that there is any legal answer to that.

But, because people are stuck in these awful situations, it is tempting to look at the situation positively.

Pros

1. There is an interim solution.
2. It gives breathing space
3. Selling the property ( realistically what they should do) is not a palatable option.

Overall, I would not like to try and make it "stick" because of all of the variables. But, if people can agree, and can be relied on to be honorable...........maybe its worth a shot.

mf

 

[Brendan Burgess]

Hi mf

Thanks for that.

Agree fully that a clean split is much better and is worth paying for.

However, it's unlikely to be worth losing a tracker for.

Brendan

 

[mf1]

Umm.

So stay tied up with the person you don't want to be with for the sake of the tracker?

Call me a hopeless romantic but, when the LUUUUUUUUVVVVVVVVVVV stops, so does the inclination to have any connection with the former partner that gives them any chance to cause chaos in my life. Let me count the ways.............

mf

 

[McStuffins]

I am in a similar position where my ex is residing in the jointly owned house and pays the mortgage. I live elsewhere and have no part in the mortgage.

We have tried to have my name removed from the mortgage and deeds but the bank won't agree to it.

We attended a solicitor and were not advised that this would be an option so I'm not sure how much standing it would have legally. I know I'd be reluctant to sign something that waived my interest in the house while retaining a contract with the bank which leaves me open to being pursued for the amounts owed. And I doubt my ex would sign something that states he's responsible for each monthly payment while my name remains on the deeds.

I'm not legally minded but I'd imagine that the mortgage and the deeds of the property would trump any agreement that myself and my ex sign. Realistically if he lost his job I'd be responsible for the mortgage no matter what we had signed. And if I were to die or remarry etc, legally I still own half the house.....

 

[Brendan Burgess]

Hi McStuffins

The ideal is to get your name removed from the deeds and the mortgage.

The side agreement is not perfect, but it's a lot better than no agreement.

At the moment, your ex is paying down the mortgage, yet you have a full claim on the house. If the house is in positive equity, he is very exposed.

And, you can move back in any time.

You currently have a relatively good position, as long as he continues paying. Once the negative equity is gone, you will be in a great position.

If he stops paying, then you can encourage the bank to repossess the house.

The downside for you is that you may not be able to get a mortgage elsewhere until this mortgage is discharged.

If you are both talking at the moment, now is a good time to do an agreement between you.

Brendan