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I need some advice. I am going though a divorce at the moment we have yet to file. We have no children we did however buy a house before we separated last year. The house ended up in her name because her credit was better then mine. I have moved out about three months ago. My mom took part of my inheritance & let us use it to put a good down payment on the house. The house is the only thing that we have together, even though it's not in my name. I'm not sure if common law comes into play here or not. She wants to try & buy me out we verbally agreed that she has a year from the time I've moved out to do this. If not we have agreed to sell it. I want to make sure that our verbal agreement makes into the divorce papers. With the market the way it is I can see her sitting on the house for a good while. I want to make sure that I'm not going to get screwed over with this I want the divorce over with or at least filed by February which at that point I'm moving to Greenville. I know I should have a lawyer look at the paper work before I sign it. Should I also have a real estate lawyer look it over? What questions should I ask? Forgive me if this in in the wrong section.
You really need to talk with an attorney. I would think your divorce atttorney would know enough to have this covered without having to get a seperate real estate attorney, but that is just my guess.
What determines a buy out price? How do I go about figuring out what they is & how much? The soon to be ex mentioned that she would like to try & buy me out in a year after the divorce is final. Some one did tell me that it's a percentage of what we paid for the house. We paid $108.000 for it.
A current appraisal will give give you the current market value.
What do I base the buy out price on? 10% of the appraisal of the house? Sorry I just don't want to get messed over with this deal. I'm not even sure if I'm asking the right question/s.
The buy out price is typically based on the appraisal. What often happens out here is that the buy out price is 50% of the equity that you would normally get if the house sold. So essentially you split the profits 50/50. It may be different in your case since you brought the down payment in and sometimes how much each person paid into the loan payments and maintenance makes a difference.
There isn't a one size fits all set percentage, unless things were totally equal. Then it is typically a 50/50 split of the equity.
The buy out price is typically based on the appraisal. What often happens out here is that the buy out price is 50% of the equity that you would normally get if the house sold. So essentially you split the profits 50/50. It may be different in your case since you brought the down payment in and sometimes how much each person paid into the loan payments and maintenance makes a difference.
There isn't a one size fits all set percentage, unless things were totally equal. Then it is typically a 50/50 split of the equity.
I know last time the soon to be ex & I talked, she talked about her buying me out she gave me a price of $7,000. I'm not sure how she came up with that. I know regardless what I put down as a down payment I'll never get that back. Sorry for all the questions I'm just trying to get out of this quickly, & with some money in my pocket without drawing this out & it becoming ugly.
If you paid $108k last year, it's probably still worth only $108k. Average selling costs (in Texas) are about 8.5% and that includes commissions, title policy, and other closing costs. From $108k, back out 8.5% and you get $98,820.
I'll assume you only put down 3.5% as that's what most people in this price point do. That's a loan amount of $104,220 currently...
If you would "net" only $98,820 right now and you owe $104,220. There is no "buy-out" to be had. There is no potential "profit" to share 50/50.
If you put down 20%, and have a loan amount of $86,400, you would then subtract the 86,400 and the 98220 and get a difference of $11,820 and half of that would be $5910...
You need to know what you owe on the house and what your potential closing costs would be to be able to determine a buy-out price. She might not owe you a thing if you currently owe more than what you would net... run your numbers.
I know last time the soon to be ex & I talked, she talked about her buying me out she gave me a price of $7,000. I'm not sure how she came up with that. I know regardless what I put down as a down payment I'll never get that back. Sorry for all the questions I'm just trying to get out of this quickly, & with some money in my pocket without drawing this out & it becoming ugly.
You might want to talk to a Certified Real Estate Divorce Specialist. I believe the closest one to your area is in Florence SC. I'll send you her contact info via DM if you like.
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