Co-ownership nightmare

[AndEasy]

Just wondering if anyone else has had issues with shared ownership, and how they dealt with it?

As the story goes - 1.5 years ago I purchased my first house with my best friend, with a shared-ownership agreement in place ofcourse. We also had to get a joint mortgage, as the banks wouldn't lend to us otherwise

About 8 months down the line, he starts smoking meth and has a meltdown, both emotionally and, inevitably, financially.
He stole from me on multiple occasions and accused me of some extremely paranoid stuff, so I felt compelled to move out.
His wife & child also moved out, so he was living there by himself in a 5 bedroom home...

I suggested we rent out the extra space, as we had a clause in our agreement which would see us split any rental income 50/50, and this would benefit us both.

Well hes now renting it out, but I don't know to who, nor have I seen a bond form/tenancy agreement, or any rent money. On top of that, hes been defaulting on the mortgage, which were both jointly liable for.

My lawyer seems to think I could wait it out, wait for him to make a major mistake and then pounce. But after all the dishonesty and thievery im all out of patience.
Im sure court cases cost alot of money, but Ive missed out on over $10k worth of rent already and not prepared to let it keep going that way.

Has anyone else had experience with something similar? How did you solve it?
Is there any hope enforcing a contract, besides from taking him to court? Seems like a contract means nothing unless its enforced.
Is there anyway I could force a sale, or force him out of the contract/buy him out without his consent?

Theres a whole bunch I left out, it just gets infinitely worse...but I guess those are the main points.

[donna]

Hi AndEasy,

Welcome to PropertyTalk. You need a better lawyer. The status quo is unacceptable and your 'friend' is already breaking the law.

cheers,

Donna

[Keys]

Crucially, what is written on your property sharing agreement. No, don't put that here. Lawyer up. It may cost up front but is better in the long run. Also, talk to your bank. Keep them informed.

[Hound]

Blimey. What a situation. It's been said possession is 9/10ths of the law. Your goal should be to retake possession. Then you'll have better control over things going forward. You will be the one who comes out on top.

I've assisted friends who have had property adversely effected by occupants using meth. As you know people addicted to this drug can act in very irrational and unpredictable ways. One lot were stealing from their direct neighbors. Not very smart. They also vandalized the place, before they moved out. The situation might have been made worse than it needed to be, as the PM had called the police on them. The key is to get them out, not antagonize them. In the other case, the former occupant took his own life a few months later. I agree with those who say addiction is an illness.

Did you get to meet your neighbors when you lived there? Might pay to discreetly chat with them. Get a better idea of what's been going on at the property. Are they being effected by this? Maybe the police are already involved.

But clearly this guy is in violation of his contract with you and the bank, so a lawyer who is familiar with these types of contracts and remedies is your best bet. Getting him to agree to sell might motivate him.

When you do find a way to get him to shift, I urge being gentle about it. If that's at all possible. Be creative but not vindictive.

[spaceman]

^ Hound has provided reasoned and compassionate advice....kudos

I on the other hand suggest something a bit more brutal.

On the proviso your side of the story is accurate.....a spot of recreational drug use is different to being a drug addled loser.

You need to get him out of the house and you back in.....by fair means or foul.

1. Move back in...it's your house too.
2. Pay him to bugger off and never come back....cash or drugs....whichever gets him to agree.
3. If 2 doesn't work do whatever it takes to convince him that life would be better if he changed his evil ways...….violence solves everything when push comes to shove.

The guy has already F$@Ked you......are you going to let him keep doing it??

Good luck

Cheers
Spaceman

[Aston]

Check to see what your Ins Co. may have to say about this situation, with regard to maybe deliberate, or otherwise, damage caused by a legal owner/occupant.

My suggestion would be to get him out of the house and you move back in asap.

[klauster]

Get a better lawyer, enforce your Co-ownership agreement, and get as much information as you can get from the lending bank, and neighbours...!

[hawkeye]

Can the bank force a mortgagee sale? You’ll lose money but not as much as you could if it carries on. But if he burns it down are you insured?

[mrsaneperson]

Can you afford to buy him out?
Check with your bank if they would be prepared to loan you 50% of the house valuation.
Avoid lawyers they will only cost you mega dollars and usually try and create more conflict to keep their cash payments coming in.

[artemis]

I bought out a co-owner, and it turned out great though highly stressful at the time. The co-owner decided a laid back lifestyle was more important than working a normal week in a normal job and thus being able to pay the mortgage, the rates etc. Eventually moved overseas and I bought him out at his asking price. This was more than the contract calculation but he wouldn't budge. What he didn't realise was that values had gone up a lot while he wasn't looking. Well he was looking, but looking at the last RV, and couple of months after the buy out went through the new 3 yearly RV came out. Definitely worth the hassle and pain.

So suggest you consider the buy out option if you can. If nothing else it removes a large monkey from your shoulder. Replaces it with a different monkey but at least you are back in control.

[AndEasy]

Thanks for the replies everyone - Its given me alot to think about

I have been informed by tenancy services that I cannot inspect the property without giving notice to the tenants, issue being I do not have any of their contact info in order to give them notice... Essentially I cant even set foot on my own property??
Tenancy services wont give me any of their contact info, unless I am the landlord, which ofcourse Im not because i didnt sign the tenancy agreement or bond forms... Ugh! It just keeps getting worse.

The buyout option is an option, but he has to agree to it willingly
I have offered to buy him out (or rather my dad has) but he has not accepted - I had first offered this over 5 months ago and have persistently reminded him the option is there.

I had thought of moving back in to regain some control, but the house is in coromandel and Im currently in auckland living with parents as I cant afford to pay both mortgage and rent - plus alot more jobs up here.

I think getting a different lawyer may be step no.1

Waiting for bank to foreclose may be an option, although it would ruin my credit rating further and highly likely lose alot of money, given there hasnt been much in the way of appreciation over 1.5 years

[mrsaneperson]

Isnt getting another lawyer in this situation rather toothless?
The courts or police probably won't get involved as its a civil matter between you and him.
What about do bing in his activities of drug taking to the police, he gets arrested, goes to jail maybe?
In his absence you can move back in,.
Tricky situation, I feel for you.
Was this chap always a bit of a druggie or maybe this is a new development?

[AndEasy]

So the battle continues.. have a very clear and favourable offer on the table but he is not having a bar of it.
Next course of action is purely monetarily motivated, but if we can't strike a deal then its either take him to court or mortgagee sale

Fully aware neither option is favourable but what would be the least harm?
Credit rating doesn't matter, won't be in a position to buy another house for a long long time..

Anybody had experience with mortgagee sales - what kind of fees are involved/how much would I lose?

[sidinz]

Try posting your story on the Facebook chat group. (Property Investors Chat Group NZ) Several members are lawyers who would give you some good advice for nothing and probably several people who will know the ins and outs of mortgagee sales.