divorce and the house ?

[dshaw4096]

So how does it work?

Here is the situation, I moved out. We had a house bought for 530,000

- sunk 30,000 of our cash into the down payment
- over the course of 7 years paid 140,000 in mortgage payments
- the equity is minimal - lets say 30,000 - the rest of the mortgage payments went on interest payments
- the value of the house is now 470,000 due to market fall

my to be ex-wife is saying she keeps the house and owes me nothing because its not worth more than the outstanding balance on the loan.

wtf that does not seem right

 

[Dougal Short]

Add up the assets, subtract the liabilities and divide by two. That's the dollar amount. How you choose to split the remainder is up to you.

I'm no expert (other than I'm divorced) but I don't know that what you paid for the house is relevant. It's what it's worth now. If this was a car for example, you would use the book value of the car now, not what you paid for it.

Get a lawyer.

 

[dshaw4096]

Well it seems to me having 23 years left on a mortgage is an asset that does not qualify as being an asset.

 

[Dougal Short]

Well it seems to me having 23 years left on a mortgage is an asset that does not qualify as being an asset.

That's the other thing I was going to say. The only "asset" is the equity you have in the house...

Like I said, get a lawyer... and do your best to keep if friendly, or you'll just end up paying a fortune in legal fees.

 

[kid_kuh]

Tell her to let's sell the house and split the difference. See what her reaction is... Doesn't seem right to me... But I'm not a lawyer.

 

[dshaw4096]

Tell her to let's sell the house and split the difference. See what her reaction is... Doesn't seem right to me... But I'm not a lawyer.

As tempting as that might be I wouldn't do it to the kids.

 

[TeasePlease]

There is no equity; the house is under water.

You get to split the difference on the liability. So, ~$30,000 net difference or $15,000 each?

After transaction costs and moving, etc. hardly worth the hassle.

Or you could just tell her that she can keep the house and walk away.

 

[Dougal Short]

As tempting as that might be I wouldn't do it to the kids.

This is the problem we all face... Guilt over the divorce. I think the trick is to well informed... hence the lawyer. If you CHOOSE to pony up more than you want to then that's ok.. it's your choice. Don't forget, there are tax implications to all of this as well, which depending on your income can have a huge impact. If I recall correctly spousal support is tax-deductible, child support is not. But none of this has anything to do with separation of assets.

Again... get a lawyer. In my case, but corporate lawyer recommended two other lawyers who specialized in mediated settlements. (He couldn't represent either of us due to the conflict with the businesses I owned.) I met with my lawyer, got the poop. My ex and I sat down, drafted our own agreement. My lawyer reviewed what we had done, wrote it up. My ex took it to her lawyer. We tweaked it a bit and that was it. Total legal bill was about $2600 combined.

The way the law is, divorce is really a business transaction. The trick is to park the emotions. And remember that the kids are everything.

Divorce is no fun, but you can make it manageable if you keep you whits about you, and your wife does as well.

 

[fmahovalich]

A lawyer ??? For WHAT?

He spelled it out......no equity in the house.

Clearly...he gets the BETTER DEAL WALKING AWAY.

Not sure on status of support, pensions, etc....but on house equity...after lawyer and real estate fees....

TAKE HER OFFER.

Now you have the upper hand....it is civil...and all is good!

 

[k57]

A lawyer ??? For WHAT?

He spelled it out......no equity in the house.

Clearly...he gets the BETTER DEAL WALKING AWAY.

Not sure on status of support, pensions, etc....but on house equity...after lawyer and real estate fees....

TAKE HER OFFER.

Now you have the upper hand....it is civil...and all is good!

Actually he said there's possibly $30,000 equity. What's not clear is what's the principal on the mortgage now. I assumed it's $30,000 less than the potential resale value. However then he adds that the ex says the outstanding balance is more than the resale value. So which is it????

Overall, walking away sounds best.

 

[Dougal Short]

You still need a legal agreement to make it final. And both parties need to have independent legal advice or one party can come back years later and argue that they were not well informed and need to re-do everything. There are also children involved so he can't just "walk away". There needs to be an agreement that spells out child support, visitation rights, who pays for University, riding lessons etc etc.
.
He needs to get a lawyer, get a proper separation and support agreements and ultimately get divorced if they aren't getting back together. "Separated" is still married.

Overall, walking away sounds best.

The house is a tiny part of this proceeding. Did you miss the part where they are married? And that there are children?

You guys are totally ignoring the big picture. The house issue will probably turn out to be a complete non-issue in the overall scheme of things, because it has little, if any equity. Presumably his wife can't keep up the payments alone, so without a proper LEGALLY BINDING agreement, there is nothing to stop her from stopping payments on the house she is living in, forcing him to deal with the bank and to make the mortgage payments on a house he no longer lives in.

Give your heads a shake guys. The advice you are giving is BAD.

 

[fmahovalich]

Payments are always 50 50......

Andnthat is much easier to arrive at when things are civil.

So...yes he may wanna help pay for University.....but that is a choice if he wants to lay his 50%.

What parent is obliged to pay for University. Mine never did.

Now he may support it...then when kid graduates, can claw it back if affordability is an issue.

 

[TeasePlease]

What parent is obliged to pay for University. Mine never did.

Very common demand in divorce settlements now.

 

[fmahovalich]

I know..keeping in mind both parents on the hook for 50%.

If, prior to the divorce, paying for University was not happening due to affordability, it certainly is less affordable after.

Keep it civil!!!

Perhaps co sign a line of credit to look after Dads portion.

 

[dshaw4096]

Actually he said there's possibly $30,000 equity. What's not clear is what's the principal on the mortgage now. I assumed it's $30,000 less than the potential resale value. However then he adds that the ex says the outstanding balance is more than the resale value. So which is it????

Overall, walking away sounds best.

If the house is sold the loan is paid off - no profit no loss.

 

[dshaw4096]

You still need a legal agreement to make it final. And both parties need to have independent legal advice or one party can come back years later and argue that they were not well informed and need to re-do everything. There are also children involved so he can't just "walk away". There needs to be an agreement that spells out child support, visitation rights, who pays for University, riding lessons etc etc.
.
He needs to get a lawyer, get a proper separation and support agreements and ultimately get divorced if they aren't getting back together. "Separated" is still married.



The house is a tiny part of this proceeding. Did you miss the part where they are married? And that there are children?

You guys are totally ignoring the big picture. The house issue will probably turn out to be a complete non-issue in the overall scheme of things, because it has little, if any equity. Presumably his wife can't keep up the payments alone, so without a proper LEGALLY BINDING agreement, there is nothing to stop her from stopping payments on the house she is living in, forcing him to deal with the bank and to make the mortgage payments on a house he no longer lives in.

Give your heads a shake guys.

Hmm good point. Though she can make the payments alone for now.

She is in the USA and I'm in Toronto so not sure the bank could do anything from the states of course.

 

[fmahovalich]

Dealing with the house issue by itself.

THEY need to go into the bank and get all mortgages transferred to the wife. She will need to be approved, and sign onto a NEW mortgage...before hubby walks away.

She must be the one liable, should mortgage payments fail.

Again, on the house issue alone, this can be done without a lawyer. Just go in as a couple and talk to the bank. They will always protect themselves, and by default, you are protected once OFF THE MORTGAGE.

Other issues can then be separate. If she made more...she may owe you equity payments. Children custody I presume is joint...or should be....and this will be money neutral.

 

[IM469]

The law is 50/50 on all accumulated assets during the marriage. I've been married and divorced so in my experience - this never happens. You typically get whatever falls off the truck. :frusty:

 

[rafterman]

Yeah you better hope she can qualify on her own or you are stuck as long as the loans are outstanding. If the mortgage defaults you are going to remain liable.

 

[Dougal Short]

So is the house in the US? In that case, I have no idea how any of this works. Hopefully it's in the state where that Senator is. Then you can probably just throw her out of the house and blame the kids on a rapist.

Oh wait, if she was raped, she would have been able to "will" the pregnancy away.

OK, I gotta do some work.

Fucking TERB.