Q: I own a home with a lady, we are not married. We have children that are all over 18 years of age. I now want to sell the house, but she does not want to sell. She has never made even one mortgage payment. I worked two jobs to pay the down payment.
I just want to sell the house and split the proceeds and go on my way. The house was purchased in March of 1986 for $84,500. I owe $32,000. There is only the first mortgage on the property.
A: Let’s address the big elephant in the room–you’re ready to break off this long-term relationship that you’ve had with your lady friend. You don’t say whether you have children together that are over the age of 18, or whether each of you brought children to the relationship and now they are all out of the house. In any case, it’s clear that you’re ready to move on and are looking for a way to do so gracefully.
What you haven’t made clear is whether you and your lady friend have actually had a conversation about your desire to end the relationship. If you haven’t had that conversation, you need to have it. Perhaps her interest in staying in the house will change if you tell her you’re ready to move on. But it will certainly change how you and she react to each other as you divide your assets.
Speaking of which, when you buy property with someone else, and their name goes on the deed, they may own half of the property–whether or not they have ever contributed toward the mortgage. You didn’t mention whether your lady friend also has her name on the mortgage to the property. If she does have her name on the mortgage, then at least she is legally responsible for half of the payments, some of which you may be able to recoup depending on how you structure the sale and distribute the profits. If not, then you’ve made a foolish decision, which is to give her half of the house without having her be legally liable for the mortgage.
From her point of view, she’s poured years of sweat equity into the property while you and she have lived there. If your arrangement was that she would pay for other things, or raise the kids while you had a job that brought in money, and she lived up to that agreement, you don’t have much to complain about. Or, if she also works and her income paid for other joint expenses, such as utility payments, food, and other household expenses, it’s hard to make the argument that she never contributed financially.
Once you and she are on the same page about splitting up, you can have a discussion about what to do about the property. You should find out how much the property is worth. You can get a general idea from local real estate agents and from looking online at other properties that are for sale in your neighborhood.
If she is enticed by how much cash she can get for her share of the property, then you and she can agree on a price for the property, she can get financing for the house, pay off your existing loan and give you whatever equity is outstanding.
If she can’t afford to live in the property, but refuses to sell, you may have to file a lawsuit against her to get her to move, or find another carrot you can offer that will produce the same result.
I think it would be helpful if you consult with a real estate attorney who can outline the various ways you and your friend can divide the equity in the property and move on from this relationship. Be prepared for your friend to hire her own attorney, which can make things messy and expensive, unless you find a way to finesse the situation.