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AIBU to want DD to keep home equity we gave her

(71 Posts)
fionajk42 Wed 12-Sep-18 19:06:12

After 5 years of marriage, DD & SIL are separating. We gave them £60k for deposit on their house, which they are now selling to split the proceeds. My view is that DD should get back the £60k, and that any other money left after mortgage repayment should be split 50:50. SIL's parents are telling him he should get 50% of total left after mortgage repayment, i.e. he will get £30k of the equity, even though he/they did not contribute anything to the deposit. At the time of their marriage I had said we should write it into trust for DD, but I was overruled. The money came from the sale of our old house, so we have no means to give DD any further money. Is there a way to ensure DD gets full deposit back, or do we just have to kiss this money goodbye?

jenpax Sat 15-Sep-18 14:35:06

You may have a beneficial interest in the property as you provided money towards the purchase price. This is a complicated area of land law and so I would recommend a trip to a solicitor for an opinion

mabon1 Sat 15-Sep-18 14:35:25

You GAVE THEM them the money, now it's a matter of morality and conscience on your SIL behalf, sorry but that's how it goes. I bet you are regretting not outing your foot down on not seeking legal advice, I would be.

breeze Sat 15-Sep-18 14:48:27

A solicitor would need to know other factors regarding what has happened 'since' they bought the property with your help. For example, if they both work, has your SIL contributed considerably more to the household than your DD? Therefore, he has effectively caught up. If your DD however, had to give up work to have children, she couldn't be expected to be equal in contributions so that would also have to be taken into consideration. This is a good example of how you should always get a legal document drawn up if you expected you would get your money back should they part.

Jaycee5 Sat 15-Sep-18 14:49:32

Trusts don't have to be in writing but there must have been an agreement between you and the donor that the money was to be held in trust and returned to you on a sale. If they property was in joint names you would have problems with proving such an agreement. It is a shame but you were over-ruled. It is a lesson to anyone providing such a large sum to always look at the worst that can happen and prepare for it. Given the number of ways in which this could have been recorded (either the property could have be registered as tenants in common in unequal shares, or there could have been a charge over the property or a separate written trust or agreement) a court would take some persuading that there was an unwritten trust unless you could show that there was a good reason for having one.
Having said that, assets are not always divided 50/50 on a divorce particularly a house where one party may have put more in either in money or work on the property and she should not agree anything without speaking to a specialist divorce lawyer. Things aren't always dealt with as people expect. People often initially just want things to be over quickly and to be reasonable, but they may not realise that the other side isn't being reasonable until later on when the feelings have subsided a bit.

Diana54 Sat 15-Sep-18 14:52:11

I think you can wave goodbye to the £60k, let's hope that your daughter gets her half back and maybe a bit more too, although it could easily be less.

I think if you had given the money to your daughter specifically then she would be able to claim it all back plus a share in any profit or loss on the sale, particularly after a short marriage.

Could anyone else confirm that or otherwise

Esspee Sat 15-Sep-18 15:05:26

I think this hinges on the word gave. You say you gave the money to them.
I lent a considerable sum to my son to allow the purchase of a house. He has intermittently made repayments and now the marriage is all but over the house is being sold. Fortunately my son seems to be in control and says that on receiving the sale price firstly I will be repaid, then all their debts, then the balance remaining will be split 50:50.
Hopefully all will go according to plan.
In the OP's position I would consult a lawyer.

starbird Sat 15-Sep-18 15:45:49

If kathyd ‘s friend got her money back in similar circumstances then it is worth a try asking a judge to decide how the finances should be shared. If nothing else it might get into the local paper and shame the SIL !

anitamp1 Sat 15-Sep-18 16:09:03

Difficult. My personal opinion is they should split 50/50, including your deposit. It was a gift and not a loan. I know it's a lot of money but it was never given in anticipation of getting any of it back. And they do both have to set up new homes.

luluaugust Sat 15-Sep-18 16:10:26

Well anything is worth a try but won't it cost even more money to do it? Was there any discussion at the time? it sounds like you just gave the money as a gift and you were the only one who had thought of the future.

123kitty Sat 15-Sep-18 17:14:01

As you gave this as as gift with no expectations of it being repaid I think profits after the house sale should be 50:50.

Coolgran65 Sat 15-Sep-18 17:17:05

fionajk52 - we are presently in a very similar position. The couple have been together for 10 years and are not married. Two years ago we provided the deposit on the understanding that if at any time it was possible to repay the deposit, it would be done. The house is now sold and the other party is saying we are not being repaid 'her share' of the deposit. Neither she, nor her family, put anything towards the deposit.

The Mortgage company asked us to sign that the money was a gift. This was the only way it would be accepted as the deposit. We signed that it was a gift. So, legally it was a gift but morally it was a different matter. In two years she has benefitted from the half deposit plus half equity. Also, our son paid the mortgage, loans, childcare and all utility bills. She bought the groceries.

The house has made equity but even so, she is still keeping 'her half of the deposit.'

She is legally correct. Fortunately the sum of money concerned wasn't as great as your £60k.

There is a thread on here about it. I felt utterly betrayed but have come to accept that like yourself, we have to wave goodbye to the money.

I'm sorry this has happened to you. flowers

alchemilla Sat 15-Sep-18 17:20:47

I think it might be worth going to a solicitor with your paperwork. 5 years of marriage and no children you mention? It might be worth a try to sort out a fairer split - but your DD would have to work out what she and her DH put in themselves.

But still be prepared to kiss half of your investment for your DD goodbye.

knspol Sat 15-Sep-18 17:48:39

If sil was a reasonable person then I would expect him to forgo any call on the 60k but it seems he may not be and is also being encouraged by his parents. I agree with others, morally it should go to your daughter/yourself BUT I wouldn't give up without first consulting a solicitor, even a strongly worded 'official' letter might work wonders.

GabriellaG Sat 15-Sep-18 20:03:00

It's a pity that all parents (and GPs) don't think twice before giving/lending money in this manner.
Married couples and singles living as partners, are parting and divorcing much more often than was the case years ago and money is always a contentious issue.
I always get everything in writing so that there can be no argument but then, I have rarely lent money and never the sort of money for a house deposit. When mine bought property, deposits were affordable from their own pockets.
I doubt whether the OP's SiL would be gracious enough or moral enough to give back the whole amount.
Show me a person who would willingly forgo £30k....hmm

Bluegal Sat 15-Sep-18 20:12:56

Absolutely Gabriella but would the daughter forgo £30K if the boot was on the other foot? That is what I was trying to say. If it was the other way round would everyone be so supportive? We don't know the reasons for the break up either so I guess I am just thinking IF they married with the intention of staying together for life - as most people do - then all becomes joint! Unless there are exceptional circumstances I don't think any one partner should come out of the marriage better or worse than the other JMO.

alchemilla Sat 15-Sep-18 20:34:28

Bluegal I certainly would, especially after such a short marriage. Sauce for the goose etc. I think this is exceptional - £60000 in from the parents, 5 years of mortgage payments, no kids we know of .. I'd expect to have my DS or DD to have at least 75% back - after mortgage and increase in house value.

Urmstongran Sat 15-Sep-18 20:38:17

Our daughter, aged 40y has just got onto the property ladder, thanks to her partner (of 5y) - his parents put up £50k deposit on the understanding that if they part, his inheritance money comes back to him. Our daughter is so grateful for their generosity. It has enabled them to get a mortgage & no longer rent. As she said, should they split up, of course she would repay his kind parents that deposit money. Then, any money they would make on the property would then be split 50:50. It’s morally right. It’s how you bring them up that counts in the end. Our daughter would be horrified (as would we) to contemplate anything less.

GabriellaG Sat 15-Sep-18 21:46:47


I absolutely agree that virtually no-one in their right mind would willingly or graciously want to forgo such a sum, no matter how moral we think we are.
We can assume that everyone who marries, does so wearing the rose- tinted glasses of enthrallment but life and children and work and money and health issues, often throw us curve-balls.
I, along with others, agree that if you give money without clear paperwork showing it to be a loan, then you forfeit the right to have it returned (unless the borrower is a saint)
I can understand the frustration of the OP losing tens of thousands of pounds, I'd be fuming. A bitter lesson learned and I hope the family can successfully move on.

GabriellaG Sat 15-Sep-18 21:57:30

Mortgage companies need to know where the deposit money comes from.
They will only accept money donated by 3rd parties, if it is a 'gift' and that rules out any other legal claim on the 'gift' in the event of a marriage breakdown and sale of the property, as the house is still owned by the bank.
To say, after the event, that it was a loan, is to say you lied when signing the mortgage agreement and the underwriters would have something to say about that deception.

Apricity Sun 16-Sep-18 01:25:38

Morally most people would agree that the right thing to do would be to return the money. But this isn't a moral question or a matter of opinion or speculation and what ifs, it is solely a legal question. Lots of informed advice about this has been provided. There are only two options available to the OP - to seek specialized legal advice on the matter or to let it go.

crystaltipps Sun 16-Sep-18 06:43:39

When we gave our daughter a substantial sum as a deposit on a flat she was buying with her bf it was a gift to her not him. We got that acknowledged legally beforehand so that in the event of a split she would get the deposit back , then any equity would be split 50:50. It added a few £ to the legal bill, but worth it to avoid the possibility of waving our money goodbye.

Ginny42 Sun 16-Sep-18 06:49:34

A 5 year marriage is not considered a long marriage and in such cases what you put in is what you take out. She could offer to pay him a sum to settle and he may accept it.

Lyndylou Sun 16-Sep-18 11:30:08

My son and his partner are presently house searching. He had some deposit money but she had twice as much so I formally gifted him the difference. That way they start off equal and if they break up they can split it 50:50. As people have said the mortgage company insist on the money being a gift which is fine, but he knows it is a gift out of my future house estate. When I go, my daughter will first get the amount I gave my son, then the rest will be evenly split.

Not much help to the OP, I know, and I do feel very sad for her, but maybe help to anyone else thinking about this.

FlexibleFriend Sun 16-Sep-18 12:34:30

It depends if they go to court to fight it out or not, but be warned my legal fees for my divorce came to £20k and everything within the marriage is deemed to be owned 50-50. My house which was owned outright by me when we married included. He had £30k from his previous house sale of which I saw nothing, he bought a new car etc. He was after much haggling awarded 25% of my house, I was told it was too big for me and could easily live in a 2 bed flat. I kept my house by taking out equity release and paying the interest so that I could get shot of him. Had little option as no one would give me a mortgage even though I can afford one. His legal fees amounted to £50K because he had no morals and was willing to see me homeless before he'd see sense. With his legal bill and credit card fees etc he ran up he had virtually nothing to show for his greed but that's human nature some people don't know when to quit. Will you Son in law see sense or will he see £ signs.

TerriBull Sun 16-Sep-18 13:28:55

I have a friend who put up the deposit for their house a number of years ago, £60,000, and then subsequently down the line split (amicably) with boyfriend. However, when they bought the house, her solicitor ring fenced that money as hers, in the event of a separation, so that would be deemed hers. She bought him out and he got 50% of the appreciation equity. I suppose it helped, that he was honourable enough to not try and claim any of the deposit money.