Q: How does buying someone out of a house work?
My fiancé and I own a house together. We are splitting up. He wants to buy me out and said he would pay me for each month we’ve lived there. So I’ve paid $650 for 28 months so it comes out to $18,200. Is this the correct way to buy someone out? I’ve been researching and feel it should be a lot more depending on the houses value. He was the one who put the down payment on it, has paid for all materials on fixing up the house and pays a little more on the mortgage each month because he can afford it. I don’t want to screw him over in any way, I just want us to do what’s right and fair. Should he be buying me out at the houses value depending on our share of the house? It’s probably 70% him and 30% me because fair is fair. I feel if we did that, I should be receiving more correct?
A: Yes, if you own the house jointly and it has increased in equity since buying it, you should ask for your 30% of the equity in the home. He may be offering to pay you for the months you've lived there to try and avoid having to give you your fair equity in the home. Of course, if the equity calculation is done, he would be entitled to take a credit for his down payment (at least as far as the percentage split goes), if that makes sense.
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