Need advice: House Buyout Negotiations with NPDX

[Upstream]

Hi All,
It's been a long time since I was last here. In the meantime, I've managed to get full custody of the kids, after which I finally mustered up the courage to get a divorce from my NPDX.  The divorce was final this past May, and since then, we've been communicating only through lawyers. He has asked me to either buy out his half of the house(he's moved 30 mins away to be closer to girlfriend) or sell it on the open market and split the profit. I agreed to buy him out, after discussing with the kids (14, 18) that they'd like to keep their childhood home, where we also currently reside. 

Two years ago, before he had a girlfriend, and moved away to be closer to her, he desperately wanted me and the kids to move out and he offered me the realtor's estimate of 270K.  Now, when he  is on the receiving end of the buyout, (he's racked up 100K in debt) he started out by asking for 470K. With the housing market rising over the last two years, the house might be worth 300K, at most, since the windows and roof will need some repairwork done.

I declined the offer, and fortunately, I'm on the deed, so he can't sell to an outside party unless he forces the sale through court.  But neither can I force him to sell me the house for a fair price unless I force the sale at auction, and then I'm afraid he'd send his rich brother to jack the price up or buy it cheap and sell it high just to make a profit. Either way, he's desperate to get as much money as he can.

He's not outwardly brazen...the word from mutual acquaintances is that he tells them he's paying for the full cost of the mortgage while the kids and I mooch off him and take advantage of his goodness by living here in a house thats much too big for three anyway. The truth is, he doesnt pay one cent towards the mortgage. I have been paying for all house expenses, mortgage, ins, repairs, all of it, ever since he moved out 4 years ago.

So the fact is, he's entitled, legally, to rent fees for his half of the house. By me paying his half of the mortgage, I am paying him "rent". And he doesnt report that income on his taxes, and I'm facing some major house repairs (windows, roof, furnace is getting old..)  on a home I dont own, and which he will not pay his half of.

Any ideas of how to pressure him to sell? So far, I've been repeating myself for the past year that I will only pay him his half of the value of the house as appraised by an official state appraiser (we live in Europe) . He agreed, and then cancelled the appt the day before the scheduled appraiser was to come, TWO TIMES. Then his lawyer sent a letter  asking me to negotiate, and make an offer. I know how that will end:
Him: 470K
Me:   270K
Him, okay, I'll give it to you cheap for 400K
Me: Not a penny over 300K.
Him: Okay, lets meet in the middle at 350K.

I doubt the bank would even give me a loan of 350K, for a house valued at 270-300K.  He's already said that he'd work with me to help me find ways to pay. (translation: I'll accept cash on the table from your parents home equity, since they have almost paid off their home, if you cant get "enough" from the bank.)

So my strategy thus far has been to wait him out, hoping he'd be so desperate for money that he'd be forced to accept a fair offer. I can only imagine that his girlfriend is subsidizing him, and possibly members of his family, all who have fallen for the fake story that he's paying for his ex wife and children to live for free in his home. Poor guy. Who wouldnt be willing to give a little money to a guy like that? The kids see him for a few hours every two weeks. They say he continues to overspend himself with a new expensive top of the line mountain bike for himself...etc.  But since I know how big his debt payments are and what his income is, I know that if he were not getting financial help, that he would probably be facing bankruptcy. Which will probably happen at some point if his girlfriend or family stop giving him money. I really thought I could wait him out, but we've been at a standstill for a year. Meanwhile, I'm paying his mortgage off, and with every passing month, home values are rising, so I'd like to close this process ASAP.

Any ideas for how I can leverage this? Asking nicely won't work. Do it for the sake of the kids also won't work. I stopped contact with his family when I filed for divorce, and all they've heard since then are his lies. I dont think they'd believe me if I told them the truth. And really, do I want to put myself in the middle of a he-said ggshe- said feud?

Any suggestions?

Upstream

[Rose1]

Can you get a realtor in and get ready to list it and let ex know how much it would list for?  I know you cant actually do  it without his ok but it would maybe focus the mind on reality.
And if you did get a great offer you could think about whether you actually want to live in an ageing house which needs repairs while he continues to complain how he got ripped off by the ex.
Sometimes starting fresh clears the fog .
You may be at peak at the moment. Lots of talk of financial woes and the only reason for increase house prices is lack of supply due to covid. That can change.
If you are planning to stay then negotiating an offer at peak isn't in your interest. Depending where you live or course and local circumstances

[Penny Lane]

I'm not sure I understand the situation. You both jointly own the house, right? 50/50? So the person who buys the other person out should at most have to pay half to the other one. It sounds like you're talking about paying him the whole amount, but you shouldn't have to do that. Really, it should also be the full amount, minus the mortgage, then split in half. Otherwise you're going into double debt to pay him extra money. Unless the mortgage is solely in his name and he's expecting to pay it off with the money? In which case I guess it makes sense for you to buy him out, although I still think he gets the amount of the mortgage and you split the rest of the value.

Anyway, on to your main point. It sounds like you are not going to be able to work this out with him. I'm sorry! You should be. It should not be that hard. But it looks like he doesn't really have an incentive to be reasonable and come to the table. You have an incentive, though it's not urgent - you need some clarity before you start making expensive repairs to a house you might not even own in a few years.

I think your bottom line goal here should not be that you stay in the house no matter what. I think your goal should be to live in a house that's not owned by your PD ex, hopefully but not necessarily your current house. The reason I say this is that you don't have 100% control over what happens to this house. Your ex knows he can use your desire to live in the house to try to force concessions from you. But you can remove that power he has over you by willing to walk away from the house, while fighting to keep the house. But you're not stuck if you don't succeed in that fight.

So to that end, I would prepare yourself to have to leave this house and find another one that is free of PD entanglements. I get that this might not make the most sense in a reasonable world. But he is not being reasonable, and you can't make him be reasonable, but you can remove yourself from the crux of the conflict. You might be able to keep the house, but be ready for a situation where you are not.

So, the strategy for trying to keep the house. Question, can you get an appraiser to come out to the house without your ex's permission? If so, do that. Then you can come in with actual concrete facts. You can send it to the lawyer and say "this is what I will accept."

If not, I suggest you write the lawyer back and give two options. 1. The house is worth $200k. This is the 270 number he previously suggested, minus depreciation for repairs. (I realize this isn't really good faith negotiating, but neither is he. If you're going to meet in the middle, better it be 200 vs 400 rather than 300 vs 400.) or 2. He agree to get a state appraisal and you will both agree that the appraisal is the number you will use. I think the lawyer might encourage him to be reasonable and get the state appraisal.

If you can't come to a resolution that's 300k or less, or whatever the appraiser says, then I think you should push it forward. Waiting for him to come to his senses hasn't worked. I think you should move the matter to court. Ask a court to order that the house goes to you and you buy him out after a state appraisal. If you have an appraisal, even better, ask the court to use that as the value of the house. Or alternatively ask that the court order you to sell it, and that you split the profit. Caveat: If home prices are very high right now, and are expected to go down in the next year or so, try to kick the can down the road until that time.

You might not get what you want - but you will get a resolution, and you will get to live in a house that's not owned by your PD ex.

[Rose1]

I agree with Penny Lane. I assumed the price arrangement included all the costs but of course being pd it may not.
I want to ask about the mortgage and payments made the last year.  Was it equivalent to rent? Were you paid any child support? After all its his kids living in the house. Did you pay for all repairs? Taxes?  Appraisal costs? Who paid for the deposit?
It starts to get complicated but adds up pretty quickly and makes a big difference.
Basically its  appraised value or sale price, less sale expenses,  less fees of changing or clearing a mortgage, or remaining mortgage and transfer fees if you are taking it over. The bank can give details to the settlement day. Then taxes owing or paid is adjusted.

Then its the cost of any repairs or anything required to bring it to sale, split 50/50.

Then have a think about rent. You half own the house so you would not be owing full rent, only on the half he owns.  The mortgage payments you made may be higher than that. So its mortgage payments 50 percent he owes you, less rent 50 percent you owe him.

Maybe make 2 columns in a note book. What you paid and what he paid. It can get a bit clearer then.  If you both paid equally during the marriage and both paid the deposit then its only for the separation period.
You may decide to let any child support go in financial terms but I would absolutely bring it up as part of the negotiations.  It gives you something to give away.  Its possible hes never even thought about it. I know my ex was shocked at the concept.
Your lawyer should be able to help. These payout figures and negotiations are done at every sale so the new owner gets the house free of obligation in the day. Discussions around repairs and price reduction happen too. what if a building inspection finds the roof needs repair? That's negotiated or the sale can fall through.
Why should you be treated differently to a normal sale? The only difference is you're part owner.

[1footouttadefog]

Buying him out would mean half of the equity not half of the home's value.

It may be less than that if you have paid all the mortage since he left the home. 

If he will not be reasonable, I would consider selling then making a nice down payment in a pd free home.

If you are forced to sell and once you have cash ready a perfect place will come up for sale.

We had need to buy a house last spring. Several places we made fair offers on either were rejected or we were out bid.  Then we almost settled on one amd the seller did not move a thousand down to accept our offer. We said okay fine. That night I found a cute olace we liked so much more and the next morning the other place's owner was trying to walk back their rejection of our offer.  Just saying at any time there are options.

A concern of mine over staying in that house would be your ex always considering it his even after you bought him out.  Would he feel like he could drop in and occupy it of you went out of towm and the kids were home.
If you had to leave the area for a while would he move in and claim it as territory.

Would he hold it against the kids or con them out of the home if something happened to you?

I ask these questions only because I imagine the worst with a pd.

[GettingOOTF]

What does your attorney say?

If there is still a mortgage in the property he surely is entitled only to half the equity and not the full value of the house. When you sell a house the proceeds go to paying off the remaining mortgage first. You walk away with the rest. He seems not to understand this (or there is no:a very small mortgage left).

I would go through my attorney. There are established ways to to do these things. He can demand all he wants, that doesn't mean he will get his way.

With PDs it's almost never about what they say it is about. It's usually about control and further abuse.

Personally I would sell the house, be rid of him once and for all and start fresh. Of course the kids say they want to stay in the home, and I know it will be hard for them but this is really not their decision to make.  For many people their homes are their largest asset. What happens here can impact you for the rest of your life financially. Your kids are too young and too emotionally involved to see the full picture.

If your ex were capable of acting rationally and treating you fairly you likely wouldn't be divorced. He has no vested interest in what's best for you or his kids. He's already walked away and stared a new life. If he cared about the kids he'd make a plan for them to stay in the house until they are old enough to move out on their own. You are trying to do what's right for everyone and he only cares about what's right for him. This is why I strongly encourage you to deal with this matter through an attorney.

[blunk]

I was in this situation when divorcing my bpdxh. We were both on the mortgage, and I honestly did not want the house and tried to talk him into taking it, even offering to help supplement the mortgage until he could find a roommate which he said he absolutely didn't want. We had only owned the house for 5-6 years and so did not have a whole lot of equity. There had also been a drop in the market, so it was not worth my while to try to sell the house as it would have been at a loss.

It ended up that I paid him 1/2 of the equity gained in the house since its purchase (Purchase Price - Mortgage Balance divided in half...in the form f monthly "alimony payments" over 3-4 years so that he could consider it income towards the purchase of a new house). This is, of course, only the case if you are both on the mortgage. It was unclear from your original post if this is the case, as you only mention being on the deed. Also, in my case, this had all been laid out at the time of the divorce...and the judge implemented a timeline for the completion of the refi, which I had to do to get his name of of the mortgage...she also verified and had me state for the record that I would be responsible for any shortfall (if the assessment for the refi would not cover the balance of the mortgage).

Also, having been removed from the mortgage allowed him to qualify as a first time home buyer which allowed him to take advantage of certain home buying programs in our area. Oh, and after all of this, he bought a new house within a mile of the old one...with a ROOMMATE!