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Clause in contract to assume control of family home

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Hi



I was hoping someone can answer this queery I have.  My brother and wife have decided to separate.  They have 1 child.  My brother wants to buy out his wife's half of the house.  There is not much equity so will only need to pay her around 12,000.  However as the house is in both names he would like to refinance to put it in his, hwever cannot afford it at this time.

Would it be legal to put in the agreement that he will refinance when he can afford to do it (possibly 12 months time) however will assume all financial responsibility of the house now?  He hopes to have enough saved up in 12 months time so the bank will refinance.

Would that agreement be legal?

I appreciate any help you can provide
Yes you could agree on this and have consent orders drawn up to that effect. I would advise you make provisions in the orders if finance cannot be obtained in the agreed time frame.
Wilko76 said
 However as the house is in both names he would like to refinance to put it in his, hwever cannot afford it at this time.

Would it be legal to put in the agreement that he will refinance when he can afford to do it (possibly 12 months time) however will assume all financial responsibility of the house now?  He hopes to have enough saved up in 12 months time so the bank will refinance.
The basis of any agreement is being able to have finance available at the time. You appear to be expecting the brother's wife to put her life on hold until your brother gets his act together. When a house is no longer a home then it has lost it's essence.

Selling the property and dividing the pool of assets on an agreed basis would be in the best interests of both parties. That basis is determined along the lines of the Family Law Act. There is a consideration of ALL the facts, not just the wants of one party.

With seemingly little money involved the preference for an outcome without siphoning off any money to the legal industry is worth considering.

What is done for you, let it be done, what you must do, be sure you do it, as the wise person does today that what the fool will do in three days - Buddha
Wilko76 said
Hi



I was hoping someone can answer this queery I have.  My brother and wife have decided to separate.  They have 1 child.  My brother wants to buy out his wife's half of the house.  There is not much equity so will only need to pay her around 12,000.  However as the house is in both names he would like to refinance to put it in his, hwever cannot afford it at this time.

Would it be legal to put in the agreement that he will refinance when he can afford to do it (possibly 12 months time) however will assume all financial responsibility of the house now?  He hopes to have enough saved up in 12 months time so the bank will refinance.

Would that agreement be legal?

I appreciate any help you can provide
 

Yes it is legal as long as you both agree, and there is no pressure on any of the parties to agree. As said else where you need to think about what would happen if your brother could not get a loan.

What about interest payments over the 12 months?

Executive Member of SRL-Resources, the Family Law People on the site (Look for the Avatars).   Be mindful what you post in the public areas. 
Thankyou for the reply.  both parties agree, but it's her parents that were concerned of the legal aspect.  she doesn't want the house so it was a logical step for my brother to buy her out and keep the home so their son doesn't feel he hasn't got a home.

To sell the house means they walk away with notheing, although debt free.  to keep the house she walks away with 12 000 cash and can move into a unit with a friend.

I appreciate your responses.  Please keep any moral opinions to yourself "very dad" as I am only interested in legal fact, not a preacher



thanklyou
Wilko76 said
I appreciate your responses. Please keep any moral opinions to yourself "very dad"as I am only interested in legal fact, not a preacher
And this site is not interested in people that get what they want and then make smart remarks about other posters!

The ADVICE provided by Verdad is very sound and practical and you may find down the track that you wish you had heeded it a bit more instead of taking such an attitude. He expresses an important consideration for the court when making a consent order. Your brothers proposal has many problems to first address which may cause the courts not to make such an order.

For further information about this important issue you may consider paying a solicitor. This way you can insult them all you like when they are trying to help you.

"When there is no enemy within, the enemies outside can not hurt you"

Executive of SRL-Resources
I also agree. Verdad's advice is the best post. I have a friend who did something similar to what is being proposed and 12 months down the track the ex is wanting to revisit the settlement due to differences in valuations/appraisals of the property. The only way to work out real value is to sell. Given the current GFC, by holding onto the property/debt your brother runs the risk of ending up in negative equity territory (unless you are the north west WA). Banks are still calling in loans etc… For many the trouble is far from over.

I understand where your brother is coming from and the negative I see is for the wife as she will by technicality still be on the mortgage for 12 months.If you can work together to resolve issues it beats the court every time.
Seperating parents do not need to divide their assets immediately. They can agree from here to kingdom come. Maybe by retaining a property part paid for, it can be used later to help the other parent to purchase a second property.

Consent orders re property

The range of "Consent Orders" a court will make is quite wide, much wider than what they would make where the decision is left to the court. I know of a case where one parent was allowed to occupy the family home with the children (by consent) until the youngest turned 18, some 12 years in the future with home to sold then. There were clauses covering remarriage or relocation and the opportunity for the occupying parent to buy the other out. The magistrate commented that these were not order he would have imposed but had no objection to making them by consent. I have seen other which allow time to organize refinancing etc.

It is also important to appreciate that transfer of property between spouses is exempt from stamp duty if there are court orders. Hence the need to obtain orders, even by consent where the names of titles are to be changed.

An important consideration is to remember courts make orders about things that are to happen. So clauses covering the "what if's" are a good idea and leave the court comfortable that 2 parties are in agreement and have thought things through. Generally courts aren't very comfortable with open ended orders, so specific dates or time periods are a good idea.

The Family Law courts are also usually helpful to people representing themselves, particularly parties who are seeking consent orders.

The issue of legal advice is part of the family law act. The court will only make consent orders where it is satisfied both parties have received independent legal advice (there a specific check box on the form) or able to satisfy the court they understand the implications of the orders

And as a bonus an application for consent orders does not attract application or hearing fees.

For me - Shared Parenting is a Reality - Maybe it can be for you too!
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