Defacto couple separate with joint mortgage

[hobo-jo]

So around 12 months ago my fiances sister got together with a guy and after a few months going out (was a bit more of a history) decided to buy a house. Initially we thought it was just in the guys name but the sister who was staying with us at the time had mail from the selling agent arrive addressed to both of them which made us suspect she was putting her name on the papers. We (her family and I) essentially had an intervention and tried to stop her from buying the place with the guy as he'd been known to cheat on previous partners, a previous 1 night stand of his had a baby on the way (and there was a chance it was his) and also at the time they were buying I was turning quite bearish on property....a while later (before settlement on the property) she told her family she was no longer on the mortgage, but I was skeptical of this and always suspected she purchased with him.

Well not a year on and the relationship has turned south and she has moved out. She's now informed her family she is on the mortgage...just after a bit of advice on her behalf.

Assuming that he can afford to refinance into his own name (I don't think this will be the case) will there be any stamp duty to have the place changed into his name only?

Is there anyway that she can force a sale of the house if he can't afford to refinance into his name only?

If he wants to take over the mortgage but can't afford to refinance is there any other legals documents that can be drawn up that dissolve her responsibility in the case the house is sold later down the track for a loss or similar?

Any other tips from those that have been in the same situation or know of others that have?

 

[tigers63]

intersting state of affairs,,, I'd be interested to hear the outcome of this problem

 

[marg4000]

I think it would be money well spent for a solicitor to give legal advice.
Marg

 

[Bradsdad]

Not sure about it in SA but here there would be most likely be no SD as it would fall under the love and affection clause.
As for the mortgage she will need to have him take out a new loan just in his name and after any payout have property transfered into his name. If he can't afford it then they would need to sell it or she would have to take out a mortgage and have property transfered to her name.
As mentioned, it's time she got some legal advice. There is a document that needs to be drawn up and signed (forget it's name) in these sorts of cases. Any "mutual agreement" can come back and bite the "new" owner on the bum otherwise as the person being paid out may come back and claim that the terms of the settlement weren't fully understood and/or the financial impacts. this may lead to a claim of a further payout down the track .

 

[Peter_Tersteeg]

Not sure about defacto rights, but in Vic I've seen a few instances where a married couple has split up. Husband pays out the wife and there hasn't been any stamp duty involved.

In most cases the loan has to be completely refinanced to remove the spouces name from the title.

Definitely see a solicitor.

 

[asdf]

De facto not sure but marriage split up is fine - no stamps upon transferring to other partner. Would asume de-facto has the same rights but with this greedy government, unlikely. Jointly held IPs are bad news. Inflexible and tie up serviceability - things you don't get told when you first start out... live and learn. Almost worth divorcing to get your properties into single names then go get married again... if it saves a couple hundred ks in stamps why not... but then you've got Part IVA to contend with... freakin communists!

 

[EarlyRetirement]

There is a very easy solution. De facto couples in all states (save WA I think) now have the same rights upon separation as married couples. Previously de facto relationships were a state-determined issue, now the Federal government has legislated to bring everyone under the same umbrella.

In other words, separated de factos can now either enter into a Binding Financial Agreement which outlines what each party will get from the separation and they can also enter into Consent Orders which do exactly the same thing.

Under both, there will be a stamp duty exemption.

If he can't afford to refinance and refuses to sell, she really has no option but to commence de facto property settlement proceedings in the Federal Magistrates Court. The court will force him to sell the property.

 

[hobo-jo]

Thanks for the info guys, re: seeing a lawyer, I agree she should but doubt she has the money to do so (might see if legal aid can provide advice on the matter).

That said she went to collect her belongings from the house and last we heard on the situation was that they were "talking", if they are back together then I doubt it will last and will bookmark this thread for future reference

 

[Y33]

How mutual is the separation?

Has the property gone up in value or equity.

Is she interested in taking over the property?

Has she spoken to the bank?

 

[hobo-jo]

Personally I think they overpaid for the area at the time, so probably not likely to be much (if any) growth and would have been a close to max LVR lend.

She wouldn't have the money to take over the property.

Have confirmed they are back together now anyway, tucking this thread away for future reference

 

[RumpledElf]

One of THOSE relationships then

Some people stay together for the sake of the kids, if neither of these two can buy the other out and there's no equity, they might stay together for the sake of the mortgage ...

 

[Shaneelastic]

IMO, parents should pay for legal advice in situations like this. It's money well spent.

 

[wobbycarly]

IMO, parents should pay for legal advice in situations like this. It's money well spent.

Why the parents? If people are "big enough" to choose relationships like this and enter financially binding agreements, then they aren't "big enough" to pay for their own legal advice?

 

[Financeman68]

I would suggest to see and lawyer and or sell the house and get out of it, unless she is determined to stay there then it would depend on the numbers!