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Ask Jared Pereira Your Own Question
Jared Pereira
Jared Pereira, Lawyer
Category: Australia Law
Satisfied Customers: 15
Experience:  Principal Solicitor at Pivot Business Lawyers
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I have just broken off an engagement and my ex partner and

Customer Question

I have just broken off an engagement and my ex partner and myself purchased a house together. We had lived as a couple for the last 3 years in a defacto relationship. We bought a house worth $445,000 of which I contributed $245,000 as a cash deposit. The rest of the money was borrowed in her name from a bank. The house title is in her name only due to the loan only being able to be successful if my name was not mentioned as a dependent because I was not working at the time. There is a caveat on the property stating that I have a financial interest in the house. She is proposing to pay me out to keep the property but I do not think she has any financial right to it since I have been paying the mortgage that she was responsible for. My ex partner has been contributing to house costs by paying for food and bills. What are my legal rights to the property?
Submitted: 1 year ago.
Category: Australia Law
Expert:  Jared Pereira replied 1 year ago.

Hi there. My name is ***** ***** I'm a solicitor. I'd be happy to try to answer your question. In short, while the property is in your ex's name, you have made the major financial contributions to the acquisition and mortgage whereas she has contributed to the general upkeep. Under the Family Law Act, the court will look at what is "just and equitable" in dividing property. There is no automatic 50:50 split. Instead the court will look at a variety of factors including who contributed what and how much, the length of the relationship, who has better job prospects and income etc. As with all third party decisions, this can be a bit of a roll of the dice. Were I to hazard a guess, I would imagine given the relatively short period of time you were a defacto couple, it may well be that you may receive a larger portion of the property. However, to take the risk out of the equation, if you and your ex are on good terms, it would be better to enter into a property and financial agreement, where you can both agree on a fair and equitable outcome (and at far lower cost). Some additional information about entering into such an agreement can be found here: https://www.legalaid.vic.gov.au/find-legal-answers/separation-divorce-and-marriage-annulment/dividing-your-property/agreement-about-dividing-property I hop this has been of assistance. If so, please remember to click "ACCEPT" and rate my answer. If not, I'll be happy to clarify. Thanks and regards, Jared.

Customer: replied 1 year ago.
The agreement that we have in verbal terms is that if she is to stay in the property she will pay me $260,000 which is my deposit plus the mortgage payments I have made. She would then have to get another loan to finance the money that she would give me as a return for my deposit. She is currently suing ***** ***** for a workplace injury which she believes could pay her up to a sum of $400-$500,000 payout which I do not believe the injury is severe enough to achieve. She can work but is not doing so so she does not ruin her current lawsuit. If she is unable to pay me the $260,000 she has agreed to move out and I keep the property. Do you think this is a reasonable arrangement considering I own around 55% of the house and the bank own less than me? Can the bank take the property off me even though I own more of it than they do? I just do not want to lose this house as I payed for most of it. Would it be worth getting a consent order signed off on via court to verify the verbal agreement? Does my ex have any right to the property at all considering the relationship was only 3 years in length and I contributed such a large amount in cash via an inheritance I received? Need a bit more clarity than the first answer please as the agreement is already in place verbally but not legally.Thank you Jared :)
Expert:  Jared Pereira replied 1 year ago.

Hi, there thanks for the additional information! Ok there are a number of questions here, so I'll try my best:

Q1. Is the proposed verbal agreement reasonable?

A1. I think you are taking a risk by not writing down the agreement, and I think you are being quite reasonable. I would suggest that if you agree in principle, to get it in writing as soon as possible and give her a time limit - such as: she has 6 months / 12 months to pay you the money (by refinance or otherwise), or she releases all claim over it. Also, make it a condition that she pays the mortgage which she is living there - especially since she isn't working right now. After you get the informal agreement signed, get the Court to issue a Consent Order in the same terms - this will make it legally binding on both parties in which case, since you have both agreed there is no further issue of reasonableness. Definitely go the route of a Consent Order. While she is in a mood for negotiation, pin her down to an agreement. It will save you money and time in the future.

Q2. Can the bank take the property?

A2. Yes if the mortgage payments aren't paid, and subject to the loan contract. That's why either you or she has to keep up the mortgage.

Q3. Does your ex have any claim over the property at all?

A3. Yes. So long as you were a de facto couple, she will be entitled to some share of the overall property - but as I said before you can agree to the split, and this will provide you certainty.

Hope this answers your question - once again, quite happy to clarify if I've missed anything. Regards, Jared.

Customer: replied 1 year ago.
Thanks Jared that was some useful extra information. So she has "some claim to the property" but not the major rights to it based on my financial contribution. The despot was paid via bank cheque which could be easily tracked to the loan via its numbers. I made sure that I left a paper trail so that I could prove my financial contribution if this ever happened. My ex partner says she does not want to move but just because she wants the house does not mean she has legal rights to it. I will look into getting a consent order made out or at least something signed by the both of us on paper as soon as possible. If the agreed arrangement seems fair to you then that eases my mind considerably. I do not want to leave the property even if she does get the money to pay me out. How would you suggest I solve the issue that neither of us want to leave? Although she has said she would if she cannot pay me out the deposit. I suppose that is the part of breakups that is a no-win situation huh? Both parties will never be 100% happy its about finding a negotiable peace.
Expert:  Jared Pereira replied 1 year ago.

Hi again, I think you need to consider what you truly will be satisfied with (note I didn't say "happy" - no one is "happy" when a relationship breaks down, and I'm sorry for the both of you). If you will be satisfied if she pays you out, then that's it, unfortunately you can't have your cake and eat it. If she pays you out in accordance with the Consent Order then you have no right to live there any more. It's her house and her responsibility. You could consider other ways to allow you to retain the house for example is there any other property or financial arrangement that could be 'traded'? remember, the agreement is across all your property not just your house. If you were engaged was there jewellery? Money she owed you? is there anything else you can use as leverage? You could persuade her to abandon her claim (however small) on the house in exchange for those. In the alternative, after you have the agreement and Consent Order in place, wait her out if you think she will be unable to pay up, in which case the house is yours free and clear. I would think that living there while she is there would be awkward, but that's a matter for you to resolve. Best of luck! Regards, Jared

Customer: replied 1 year ago.
She is keeping all furniture (from her past) and giving me the furniture I payed for. As far as the personal belonging we just keep our own stuff. Okay so she has to part with her property if she is going to challenge me for the house? That comes into the equation too?
Expert:  Jared Pereira replied 1 year ago.

Hi, yes all property that you jointly bought or bought while de facto is potentially included in any financial and property settlement. regards, Jared

Customer: replied 1 year ago.
Hello Jarred. I only have a few more questions to be satisfied with this service then I will promptly rate you. It is in regards ***** ***** mortgage and how that sits with me contributing $245,000 to the property's equity. I am not saying that I would do this but just say I stopped paying the mortgage and the bank seized the property. Would they have to give me my deposit as the mortgage is only $230,000 but we paid $445.000 for the house at the time of purchase? I am just curious where my deposit stands from the bank's perspective and I am sure that you can only give me a general answer not working for the bank yourself. The reason I ask this question is that I actually do not want to live with my fiance and want to move out and have my own space. There is no way I can afford to rent a room or a house AND pay the mortgage. So I am just wondering if until the house is sold or we settle that I am unfortunately going to be stuck in this awkward living situation for the next 6 months. This is the time frame my ex has given me to give me the deposit for the house or she will take her stuff and move out. I know I may just have to wait it out but I am just trying to gather as much information as I can about my rights so I can make wise decisions about my future. Just to claify what you said but if she has a claim to the house then I also have claim to her property or is it only stuff that we have purchased together as a couple that come into dispute. Is her stuff from her previous life before we met exempt from the settlement? I just need to fully understand what property comes into the consent order and what does not so I can protect myself but also not try to claim things that I have no right to claim. I want to be as fair as I can with situation. I cannot speak for her motives but time will tell how pure they are or if she is out to screw me over. It appears that she is being fair to this point but when emotions get involved people do crazy things. I would rather be prepared for the worst than be surprised by it if you know what I mean. Thanks Jared :)