Your queries answered
QIn 2007, I bought my present residence in partnership with my then fiance. The house cost €391,000 of which I paid €100,000 cash and he paid nothing. On this basis the ownership was divided 5/8s for me and 3/8s for him. The balance of the purchase price was financed by a mortgage. I paid €150 more per month towards the mortgage as I was the bigger earner. He paid his share for two years approximately before we split up. He has since emigrated and has not contributed in any way. He has indicated verbally that he has no further interest in the house.
The bank refused my application to have his name removed from the mortgage agreement and title deeds despite being fully aware that he has not contributed in more than three years. I was told by the bank that the preference is to have two names on a mortgage as it is less of a risk for them – despite the fact I haven’t missed one payment in this time or asked for any restructuring.
I feel that if I sell the house he would be entitled to 3/8s, assuming there is no negative equity (although there is at present). Is there any action I can take to protect my position? Does the fact that he has emigrated pose a potential problem when documents need to be signed?
AThis is a very complicated and, unfortunately, not uncommon situation. Whether you are in a couple which was formerly married, engaged or cohabiting, the fact is that when both of you take out a mortgage loan, then you are both jointly and each severally liable for the full loan balance.
Where a bank indicates that it prefers to have two mortgagors, it is simply reserving its right to recover against both of you. Your ex-fiance may not have any assets within the jurisdiction now, but that may change in the future.
Where two people own a property, they may own it as “joint tenants” or as “tenants in common” in certain shares. Where a property is “co-owned”, a co-ownership agreement may be executed by the parties to govern dealings with the property if the relationship breaks down. You should ask your solicitor if such an agreement exists.
In addition, either party may apply to court (just like a married person) to determine any question between them as to ownership or possession of property. You should immediately seek legal advice on the options you have (or your ex-fiance may have) under family law statutes, as time limits apply.
Unfortunately, you cannot force the bank to agree to remove your ex-fiance from the mortgage and any attempt by the two of you to change the title to the property from both names to your sole name might be viewed as an event of default by the bank. This might result in the bank calling in your loan, or it might be grounds for removing tracker mortgage rates, if you have one.
So unless you (both) have the means to repay the mortgage in full, or unless you can remortgage the property with another bank in your sole name, the status quo will remain. You should keep a detailed and vouched record of all expenditure incurred by you in relation to the property, whether by way of mortgage repayments, insurance or maintenance. You might however, consider asking your ex-fiance to enter into a contract with you which would document his waiver of any rights in the property in return for you undertaking full responsibility for the mortgage. Neither party should sign such an agreement without the benefit of legal advice.