I think my situation is a bit different because I am the one who will move out and leave my husband in the marital home. The children have decided they want to stay home and finish their education (the are 17 and 14 years old).
I am moving to Canada. Some of the reasons for this are... I no longer have my parents here, my sister and I are not that close, so other than her and my children, I don't have anyone left here here.
I can't afford to buy a new home here. I have friends in Canada who are helping me get settled there. Property is much cheaper, I can afford a place of my own with my inheritance money.
When we first decided to divorce he said he would not touch my inheritance. But having seen a solicitor he now says that he wants 60/40 split on the house or it would not be fair to him.
I inherited around £70,000 about three years ago. I paid for an extension on the house, paid to have the bathroom completely remodeled, gave him £3,000 for a new car (with trading in the old one) I have paid for other things for the home and family so I now have £45,000 left. This is all I have to start a new life.
I feel I have put a lot into the home and he has had almost half of my inheritance already.
He is an only child with both parents and a grandparent still alive.
Another problem we have is... my solicitor told me that a charge can be put on the house so that I get my share, when our son reached 18 - which is also around the time the endowment matures. My husband says my share will be based on the current value of the house. That if I am not putting anything into the house for the next four years then I should not profit from any increase in value. I countered that if I have to wait for the money then I miss out on the interest for the next four years. I am hoping the mediator we see tomorrow will be able to clarify how this works.
I am trying to be as reasonable as I can be, for the money I bring into the house I feel he will be better off once I am not living here.
He is acting the innocent agrieved party, even though he is divorcing me on my unreasonable behaviour (he said I can't possibly divorce him as he has never been unreasonable!) I said I want to move out after October but before Christmas, so he then tells the kids I will be going the first week in November, so I feel he is pushing me out too.
Does anyone know how the charge on the house works?
It is not an uncommon arrangement for the Courts to order that the parent with care ( in this case your husband, but usually it's the wife ) has the right to live in the former marital home while the children are still dependent, and when the youngest child reaches 18 the property is sold and the proceeds divided. The charge is to make sure that the spouse who is out of occupation ( in this case, you ) can't be double-crossed by the spouse remaining in occupation ( who will be the sole owner ) selling the property and keeping the proceeds,
I think you are right that the Court would order that, whatever the split is, it will be calculated by reference to the value at the date of sale, so that the spouse out of occupation also benefits from any increase in value of the house. Please be aware that there are capital gains tax implications for you in such an arrangement, and I advise you to seek legal advice on minimising or avoiding this potential liability. I say this because, as you would no longer live there, you lose the exemption from CGT applying to your principal private residence.
It is not uncommon for the spouse remaining in occupation to be given a share which is larger than 50% when the house is eventually sold, but you need to understand why this is so. As I said before, normally it's the wife who gets the right to remain in occupation, and this means that she may have to leave the house and find somewhere else to live at a time when she may find difficulties in doing so if she only got half. Hence a split of more than 50% is not unusual, but I must stress that every case depends on its facts. If the wife had considerable means on her own, or if half the equity is likely to be sufficient to get the occupying spouse somewhere to live, then the Courts might take a different view. Not knowing your husband's circumstances, I can't comment but I hope I have said enough to explain what a charge is and why it is used.
Thank you, that is very useful, especially the CGT information.
The problem I am having at the moment is that my husband says the percentage must be on the present value, because if I am not contributing for the next 4 years then I don't get anything from any increase in the value. I am sure he is wrong, and I hope the mediator can advise us tomorrow
We see the mediator at 4pm this afternoon, I am looking forward to getting a few things clear and knowing where we stand, I hope to keep the mediation down to as few appointments as possible as it is £170 each per session.Ii will let you all know how it goes.
Mike has mentioned CGT implications on leaving the home. If you acquire a new property, or after 3 years anyway, you would normally lose the benefit of the concession exempting you from CGT.
BUT if you end up with your share of the house protected by a charge (a bit like a second mortgage really, but for you not a lender) this kind of order is known as a Mesher Order, and they are exempt from CGT.
You are right to expect a stated proportion of the value of the house at the date your charge is realised, and NOT on today's values. There should be provision for an impartial valuation of the house's value. He is flying a kite, don't be browbeaten.
It went very well. We wanted to keep it simple and we actually got it all sorted in the one mediation session!
My husband wanted 60/40 split and I wanted 50/50 but we settled on 55/45. It was explained to my husband that it is the law that I get my share when the house is sold and not now, he was not happy, cos he says he has to continue the mortgage plus another loan. The mediator suggested that the second loan amount would be taken off my share as my contribution towards the house, considering I dont have to pay any maintenance for the kids, and I get to keep my inheritance, I am quite happy.