Want help/advice with daughter's debts please.

[jen_br]

Re: Want help/advice with daughter's debts please.

Loo Loo The CSA have changed with regards to keeping housing etc Im thinking Mr Loo loo is on CSA 1 its now CSA2 which is a different kettle of fish...


WorriedGrandma I just want to say what a nice person you are to even help your daughter out of this mess! She is fortunate to have you!

[PlanB]

Re: Want help/advice with daughter's debts please.

Another thing to consider is whether to set up a Child Trust Fund or similar thing for your grandchild. That way the money would pass direct from you to the little girl at 18 years old (or later if you like), and your daughter's ex couldn't get his hands on it or include it in any financial deal they may do now over debts. Get some formal advice on this because it may be useful since it will distance your money from your daughter in legal (and benefits) terms.

Most trusts allow the Trustees (you and/or your daughter could be in charge) to make interim discretionary payments to the child from Day 1. This way you could decide what she needs which could include the cost (eg mortgage payments) of 'the roof over her head' for her and her Mum

Trust funds aren't just for spoilt little rich kids, they can be useful tools to ringfence money to be used how you want and for whom you want They can save a lot of family rows too.

[WorriedGrandma]

Re: Want help/advice with daughter's debts please.

Thank you all for your kind posts. Sorry, I'm afraid I'm feeling stressy at the moment and having trouble focussing. I haven't, as yet, got my daughter to read through the thread and, when I tried to explain, she didn't sound too impressed with giving her ex £5,000. She reckons her house would be valued at (more like) £155K than £160k. And sorry Niddy, there are a few more things I am not getting my head around in these passages:

Without wishing to further complicate things, the figures are around:

1) Equity in house £160k - £142k = £18k

2) Total of ALL loans/debts/overdrafts (joint and sole)
(roughly - his = £5.5k, hers = £10k, joint = £10.5k )= £26k

3) So equity minus debts is a minus figure, but he will argue that (although he ran up most of the debt) he has less, because it was transferred to her name.

Ok so there is £18k equity assuming best case sale versus £26k debt so if you're happy to, offer him a straight £5k to walk away with the condition your daughter will settle all debts, that way you're assuming an average increase in house equity of +£13k which in the current climate is very unlikely......

He may well take it - that way leave the maintenance issue out of things as if your daughter ever has to claim benefits, any CSA forms part of her assessment so best not to extinguish her claim as this could affect any social she may ever be entitled to.

That's what I would consider, with the alternative being spelled out to him that she will sell the house and then come after him for 50% of the debts meaning he'll actually be worse off (to the tune of at least £6.5k)....

It's what I would be looking to do.

..... I think I'm just, metaphorically, thinking aloud here: in chronological order:

1)Does it make any difference that, when her ex last paid anything towards the mortgage, the balance outstanding was greater than £142k? (So equity in house might be nearer £10k.)

2)On reflection, surely, the amount of her ex's debts, solely in his name, do not come into the calculations? My daughter would not be clearing those? They are no longer her concern? So total debts would be £10.5k + £10k = £20.5k.

Sorry. I don't mean to sound pedantic. The £13K increase in equity (my bold) assumes that the £5000 her ex would be offered would be the WHOLE of assumed increased equity minus total debts. (Whereas the original calculation offered him half.) Though I guess anything less than £5,000 is pointless?

And I'm sorry, I'm struggling with your final paragraph, Niddy. I used to be good at maths, but I am on tablets that seem to cause havoc. Is the threat of coming after him for 50% something she could do? And I'm struggling with the £6.5k? On previous figures (not including estate agent/legal fees): £160K minus £142K minus £26k equals a TOTAL (joint) shortfall of £8K. Or were you including the fees?

But, anyway, I'm now thinking equity = £13k and total debts (excluding ex's sole ones)= £20.5k.

I don't know if this makes any sense to anyone else, because I've totally confused myself.

I guess this should no longer be in Unenforceability.

[Never-In-Doubt]

Re: Want help/advice with daughter's debts please.

I haven't, as yet, got my daughter to read through the thread and, when I tried to explain, she didn't sound too impressed with giving her ex £5,000. She reckons her house would be valued at (more like) £155K than £160k.

Fine then expect him to claim a percentage of the house and renegade on his debts, as ultimately he would still be entitled as would her ex surely, assuming he had contributed toward the house repayments in any manner?

As I say, it's best to buy out exes before they try and come back for more..... as your daughter has 2 in question, namely the hubby and the ex partner she has more to lose.

In an ideal world, why doesn't she put it up for sale and just break all ties - sell it and then buy again with your assistance and a new lower mortgage? Wouldn't that be the best option all round and then she doesn't need to give the ex bugger all and she can then negotiate her liabilities to get them cleared leaving the joint and his debts alone. Obviously if the joint ones come after her after she moves then that's a bridge we'll need to cross later.

Assuming she doesn't want to sell up and move, then obviously she must first seek clarity on the ex hubby and ex partner situation before anyone pays any joint debts and or invests into the property.

Let me say, a mate once split from his wife and she kept the house, he moved away. In time they divorced yet although he was not there for the last few years, she managed to get more of the proceeds as she proved she had a vested interest so in essence they deducted her mortgage payments as a percentage to the share. Point is, she got about 10% more than him which in comparison to the payments she made, was ridiculous as in my opinion he deserved about 1% if that based on the fact he had contributed to 2 years mortgage payments yet she paid (solely) around 6 years worth. However, the problem lies with the bits we don't see - she had a fella living with her at the time and the ex hubby used that against her as additional rental income and thus got that extra 10% she had back so after a year of court battles, it ended up 50/50 even though the hubby actually had sod all to do with the house.

That's just one example of how things can seem good but actually, a simple deal sometimes works best as the law is an ass at times.....

[Never-In-Doubt]

Re: Want help/advice with daughter's debts please.

To answer your questions;

1)Does it make any difference that, when her ex last paid anything towards the mortgage, the balance outstanding was greater than £142k? (So equity in house might be nearer £10k.)

It's not as simple as that - see last post above.....

2)On reflection, surely, the amount of her ex's debts, solely in his name, do not come into the calculations? My daughter would not be clearing those? They are no longer her concern? So total debts would be £10.5k + £10k = £20.5k.

No his sole debts don't matter really but if he has an old statement that shows he spent something on the house, then that's a different story...... It's the joint debt's that matter - only the joint debts. I only included his (and her) sole debts to add to the overall sum.

Sorry. I don't mean to sound pedantic. The £13K increase in equity (my bold) assumes that the £5000 her ex would be offered would be the WHOLE of assumed increased equity minus total debts. (Whereas the original calculation offered him half.) Though I guess anything less than £5,000 is pointless?

I guestimated a £13k increase in equity as a base example... Bottom line, to work it out you do this....

Figure A (equity) minus B (joint liabilities) = C (equity to share)

A - Value of house minus outstanding mortgage
B - Joint debts
C - Final Sum

Now, C needs to be divided equally minus your daughters greater interest as she has been paying it for so many years so she has a greater share in it. However if she has had another bloke living there contributing her actual hubby who she bought the house with will be able to use that against her as he can claim it is rent - ask LooLoo (one of our super mods) as she had this exact same issue with her ex.

So, if you see what I am getting at here you'll understand that a bribe of cash generally makes the exes walk away - for good! Ok, I'll rephrase, you know the men in question I don't; are they likely to walk away and not claim anything on her house or are they likely to try and claim a percentage? Why doesn't she get divorced - especially after so long of the marriage break-up?

And I'm sorry, I'm struggling with your final paragraph, Niddy. I used to be good at maths, but I am on tablets that seem to cause havoc. Is the threat of coming after him for 50% something she could do? And I'm struggling with the £6.5k? On previous figures (not including estate agent/legal fees): £160K minus £142K minus £26k equals a TOTAL (joint) shortfall of £8K. Or were you including the fees?

See above - don't look into things so much as I was guestimating.....

But, anyway, I'm now thinking equity = £13k and total debts (excluding ex's sole ones)= £20.5k.

No, it'd be £10k as we cannot include either of the sole debts - ONLY joint.

I don't know if this makes any sense to anyone else, because I've totally confused myself.

You're reading too much into guestimates. Forget sums and think outside the box - are they likely to come asking for cash if they ever find out you've invested into the house? I suspect so, ergo why not sell up and get that clean break then no matter what the house will always be her own with no claim from anyone.

I guess this should no longer be in Unenforceability.

Its fine here......

[PlanB]

Re: Want help/advice with daughter's debts please.

WorriedGrandma the thing is money and emotions don't mix very well. You've expressed your keeness to protect your grandchild. If your daughter and her ex get into a barney over money this could impact on the little girl. Her father is doing the school run twice a week so this is a good sign

You said you intend to take legal advice on where everybody stands financially and that seems a damn good start to me (speaking as a divorced mother of one!). Your daughter has not 'unmarried' her first husband ten years after they seperated which suggests that she may be a 'no-hurry' girl!

She can either go with Niddy's excellant suggestion of making her ex an offer he can't refuse, or she can she can do things her way. You're lucky your daughter even listens to you, because mine would have told me to "butt out" yonks ago

Why not ask this site to look at all those debts in more detail so we can see what's what from the age and amounts involved

[transformer999]

Re: Want help/advice with daughter's debts please.

Not sure if only joint debts will be looked at when it comes to the division of the equity as Niddy has put it..

Figure A (equity) minus B (joint liabilities) = C (equity to share)

A - Value of house minus outstanding mortgage
B - Joint debts
C - Final Sum

Would like to see if this is how it would be looked at if it went that far,

[Never-In-Doubt]

Re: Want help/advice with daughter's debts please.

Why not ask this site to look at all those debts in more detail so we can see what's what from the age and amounts involved

Offered already but not yet as we need to establish the primary objective first - UE is an afterthought at this stage (and only for the debts that include the daughter but why should we get some of the joint ones deemed UE when that helps her ex? So we hold fire till the deal is done and he's out the picture then we can do it).

make sense?

[Never-In-Doubt]

Re: Want help/advice with daughter's debts please.

Not sure if only joint debts will be looked at when it comes to the division of the equity as Niddy has put it..

Figure A (equity) minus B (joint liabilities) = C (equity to share)

A - Value of house minus outstanding mortgage
B - Joint debts
C - Final Sum

Would like to see if this is how it would be looked at if it went that far,

well sole debts after such a long separation would be down to the individual and has no bearing on divorce or otherwise does it?

Its ONLY joint liabilities that any divorce deals with unless you're mega rich or can prove that say hubby got all credit in my name cos my credit was better than his but I never used it - and you can prove that, then that's different.

Point is, only joint debts are calculated in assessments for the average person....

[transformer999]

Re: Want help/advice with daughter's debts please.

Thanks Niddy........kinda making sense now.

[Never-In-Doubt]

Re: Want help/advice with daughter's debts please.

Thanks Niddy........kinda making sense now.

Ok read this for some case examples - your specific example is in there as well

---> Divorce-Online - Ask the Experts

* Disclaimer
I am not suggesting we use that site nor do I recommend it, It was simply chosen to help answer some points regards divorce and debt as it has some good examples......

[PlanB]

Re: Want help/advice with daughter's debts please.

well sole debts after such a long separation would be down to the individual and has no bearing on divorce or otherwise does it?

Its ONLY joint liabilities that any divorce deals with unless you're mega rich or can prove that say hubby got all credit in my name cos my credit was better than his but I never used it - and you can prove that, then that's different.

Point is, only joint debts are calculated in assessments for the average person....

And the other point is the creditor will quite lawfully see the liability for any debts differently from the way a divorce (or partnership situation) lawyer will see any apportionment. Getting divorced/seperated doesn't release you from your statutory obligations to the creditor does it?

I'm a fan of settling stuff out-of-court (because I didn't and it cost me dearly) unless Paul's involved and then I have to say he deserves every penny of his hard earned costs

[WorriedGrandma]

Re: Want help/advice with daughter's debts please.

Thank you very much for your posts following my post yesterday. I was paralized with anxiety and couldn't get my head around anything. 2 Thank you, Niddy, for your replies. I am amazed you seemed to have made some sense of my madness. And thank you PlanB. I don't think I have commented on your posts, but have taken on board your suggestions about "gifts", trusts and tax.

Apologies for not "quoting"; there are several posts relating to my daughters actual marriage and actual ex husband.

She married him in 2001, aged 18, and, using £5k she had inherited, as a deposit on a mortgage, they bought a one-bedroom house for (I think) £56k. When she left him, after less than a year of marriage, he was going to continue to pay the mortgage alone, but could not afford to do so. The house had come close to repossession when someone paid them over £80k for it. They each came away with £13k (in 2005? or 2006?). This actual (ex)husband does not have a single malicious, greedy or selfish bone in his body. Not having got around to divorcing this one might have "saved" her from marrying the latter one.

Having started a relationship with the latest b*****d, at the end of 2002, they were renting, until buying the current house in January 2007. My daughter stayed off work for over a year after the birth of my granddaughter (June 2004). Some?/much? of the money from the house-sale ^^ was used to pay rent in advance (6 months? a year?). I recall her ex-partner, also, demanded (and got) a huge TV.

Anyway, in summary, it doesn't seem that the actual ex-husband figures in any disputes.

My daughter likes things to be straightforward. There were a few times when she "managed" the finances, but, for most of their time together, she preferred her ex to "manage" them.

As for the school-runs, he was doing 2 per week. It is now only one per fortnight. (I do the rest.) He has got an evening job. It was him who contacted the CSA to get confirmation that he only need pay £35 per week. The CSA then contacted my daughter. He is, currently, paying £50 per week. My granddaughter stays with him from Friday to Sunday every other week.

It might be difficult to explain what the debts were spent on, though I understand that the main purpose of the £15k (Dec 2006) prior to the house purchase was to consolidate several credit card debts.

My daughter separated from her ex around May/June 2011. Her ex's plan was to sell the house and pay off all the debts. It was put on the market for £178k. That figure sounds rather optimistic, but would have cleared everything. My daughter wanted to stay in the house and still does. She very much wants to find a way of achieving sole ownership.

Thank you all again. I can't believe how helpful and thoughtful you all are, taking time to give me your help.

Does the above make things clearer?

EDIT: As far as I know, my daughter has still not read the thread and I haven't discussed too much with her. She gets stressed at my saying "this needs to be done; that needs to be done, etc.". She is also, currently feeling tearful, unloved and unloveable .... and starts feeling she could have tried harder to make it work with her ex.

[PlanB]

Re: Want help/advice with daughter's debts please.

I've read everything you've said and I can identify with the sadness all around you at the moment I would gladly slap any bloke who made my daughter unhappy even though I know she can be quite high maintenance to live with at times

I don't know the personalities involved but you should feel encouraged by the fact that (from what you say) your daughter's ex is paying more than the CSA requires, has two jobs to make ends meat, does the school run when he can (presumably because he can't do any more while he is supporting two jobs), and has his daughter to stay with him every other weekend from Friday onwards. That last point is most important because if this was a divorce situation then the court may adjust maintenance etc to reflect the fact that he provides for his daughter's financial needs on several days a month, and as we all know kids eat a lot! There are probably trips to the cinema etc too.

I always want to help my daughter when she gets in a pickle but the balance I have struck is letting her know I'm there if she needs me with my cheque book open, but I won't actually do anything unless she invites me into her crazy world. I see the fact that she can manage without me as a compliment, because it means I have brought her up to be independant - and sometimes I have to suffer the consequences of that too

[PlanB]

Re: Want help/advice with daughter's debts please.

UE is an afterthought at this stage (and only for the debts that include the daughter but why should we get some of the joint ones deemed UE when that helps her ex? So we hold fire till the deal is done and he's out the picture then we can do it). make sense?

^^^^ I've been thinking about this. If some of the joint debts are deemed UE that will help WG's daughter as well as her ex because he'll then have more disposable income to contribute towards the upbringing of their mutual child