Equity in a Mortgage

Mortgage equity capital

Equity-releasing mortgages can release some of the value in your home, but you need to think carefully about fees and the long-term implications. Independents F: I would like to buy my ex-partner out of the home with the help of a boyfriend who I hope can take over this part of the mortgage. Well, the place was purchased for £264,000. {\pos (192,210)}My ex-partner made a 10 per cent down payment so our mortgage is £238,000.

Assuming the home has now been appraised at £310,000, I suppose I would have to give it its £26,000 back plus half of the equity made - £23,000. So if we went our different ways then would my boyfriend only be eligible for his £49,000 plus half of any equity over £310,000?

Usually when a spouse falls apart, it is believed that there will be a 50-50 breakdown of equity in the home unless the family's needs require an uneven breakdown. From a legal point of view, he can count on receiving an appreciation in the value of his 10 per cent investment, which corresponds to the appreciation in the value of the property since the purchase - in your case just under 20 per cent. However, the value of the investment will not change in the future.

Concerning you and your boyfriend, who protects the value of your collective investments once your ex has been purchased, you are in the bosom of the deities - or more accurately, moving in the residential area. Just like anyone who purchases a piece of real estate, you both venture to lose money should house prices drop.

When you try to ensure that your boyfriend doesn't loose by including a corresponding provision in a new confidence statement, you expose yourself to an even greater chance of losing money if real estate values drop. "buy out, the co-owner receives his share at full value.

Another co-proprietor keeps his - appreciative - assets, and the new co-proprietor's investments are mirrored in the value of the real estate. Whilst the co-owner being purchased receives the full value, the remainder of the initial ownership and the new ownership will lose their value investments.

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