How Much Does It Cost To Force The Sale Of A Jointly Owned Property?

Ian McEwan, Property Disputes Solicitor

How much does it cost to force the sale of a jointly owned property?

This a question that I get asked several times a week.

You won’t be surprised to hear that there is no standard answer as every case is different.

However I don’t like to sit on the fence, so usually after a few minutes of chatting with someone on the phone I can give them an estimate of what it could cost given the facts and their individual circumstances.

For some people the answer might be nothing. That might sound surprising, and granted it isn’t too common, but it does happen.

For some it might “only” cost several hundred pounds to force the sale of a jointly owned property. I say “only” with respect because that is of course a lot of money.

And for others it might cost more. That might be the case where the facts are particularly complex for example.

There are several ways to approach the situation, and plenty of tactics to employ to try to resolve matters as quickly and as cost-effectively as possible.

I’ve set out below details of those, together with some examples of when they’ve worked to give you an idea of how things could work out.

The Problem

Trying to force someone to sell a property can be difficult.

That is especially the case when the property is jointly owned between two people whose relationship has broken down.

Typically, one has remained at the property and the other has left following the end of the relationship.

In this scenario the party that has remained in occupation is usually the party that refuses to engage.

There is often animosity between the parties, with the person in occupation taking advantage of the person who moved out.

Mortgage Obligations

It may be the case that you are both jointly liable for the mortgage, meaning that the party who has left still has to pay towards it, despite not benefiting from the property anymore, whilst also having to pay rent to stay somewhere else.

With that being so common it’s no wonder that people want to know how much it will cost to force the sale of their jointly owned property.

It’s a real concern, especially when finances are tight.

Unfortunately, in a scenario such as this, the party who has remained at the property will often ignore the other party’s requests to sell completely.

Difficult People

They might do this because they just want to bury their head in the sand to avoid having to deal with the inevitable.

Or they might do it to be vindictive.

Alternatively, they might string you along with promises that they’ll agree to market the property, only to refuse to sign the estate agent’s contract.

Or they might sign it, but go on to obstruct the viewings. They might reject any reasonable offers for the property, or even pull out of a planned sale.

The toll that this can all take on the party that has left can be huge, with no obvious way to sever the financial relationship and move on with your life.

This can also happen where the parties bought a property together as a joint investment, where one wants to keep the property whilst the other wants to sell it to realise their equity to invest it elsewhere.

The problem is the same, with one party effectively being held to ransom by the other.

Can It Be Done For Free?

When I speak to people in a situation such as this I can usually ascertain if there is a chance that they can get the other party to the table without having to instruct someone like me to force the sale for them.

It will always depend upon the facts that they present me with, and if there is a chance to prevent someone from incurring unnecessary costs I’ll always recommend that course of action.

However, and for the avoidance of any doubt, I would never recommend that anyone should apply to court themselves if they are not legally qualified and do not have the necessary experience to do so.

It’s just not worth it, and can often end up being far more costly in the long run than if they were to instruct an experienced solicitor to do it for you.

Letter Before Action

In most cases I recommend that a “Letter Before Action” is sent to the party that is refusing to sell the property.

This is a very formal letter that puts the recipient on notice that unless he or she agrees to a proposed sale of the jointly owned property, the other party will be left with no choice but to apply to court for an order to sell the property, together with an order for the party in occupation to pay their legal costs.

In most cases it prompts a quick reply.

If that is the case, how things develop from there will depend upon the facts, and often the personalities of the parties involved.

To some the shock of potentially being sued will be enough and they’ll agree to sell the property right there and then.

If that is the case the cost to force the sale of the jointly owned property will usually be limited to the cost of the Letter Before Action, which in the context of the amount of equity that is usually released (or simply the relief of finally freeing yourself from an unhappy relationship) is not a lot at all.

How Much Does A Letter Before Action Cost?

That’s another difficult question to answer, but again, after having a chat with most people in this situation I can usually provide a reasonable estimate of what the letter will cost.

In almost all circumstances we’ll be able to agree a fixed fee to prepare and send a letter before action, and, as I say, that can often be the end of things.

What If It’s Not?

People often say things to me like “my ex is very vindictive, he/she won’t reply to the letter”, or “my ex will try to make this as difficult as possible for me”.

Sadly, that is quite common, and it’s understandable that someone might be worried about the letter before action not resulting in a sale, especially if their ex is particularly difficult.

In answer to that I say that the letter before action will in most cases at least open some dialogue between us, which might be all that we need.

Once we have some dialogue going, even if the other party is particularly difficult, opinionated or even volatile, we can often put enough pressure on them to get the property sold, or agree a deal of some sort to free you from the situation.

That pressure could be via further formal correspondence to really ram things home, or via a phone call in which someone who is used to controlling the situation is no longer allowed to do that.

Doing A Deal

The deal that we often reach is often for one party to buy the other’s share of the equity, conditional upon the selling party being released from any obligations under a joint mortgage.

Being released from a joint mortgage is often more important to some than the equity they stand to realise from a sale as it will allow them to finally raise finance to purchase a property elsewhere.

Every case is different.

Obviously there are costs involved in taking these steps, but a solicitor should usually be able to give you a good estimate of how much it might cost to resolve matters in this way without going to court.

What If Dialogue Doesn’t Work?

If the dialogue doesn’t work we can increase the pressure further in various ways.

That might include pointing out to the other side the amount, in financial terms, what they stand to potentially lose if they refuse to cooperate and are taken to court to force the sale of the property.

We might say that we intend to ask the court to penalise them financially if they continue to ignore any attempts to engage, and that we’ll ask the court to order that those costs be taken from their share of the sale proceeds.

It could be via the production of formal court papers as a scare tactic, which often works.

Make An Offer

Or it could be by making an offer to settle.

There are many ways to make an offer to settle, and the terms of the offer will be dictated by the facts of the situation.

However, if worded correctly, a properly drafted offer letter can put serious financial pressure on the other side to settle.

We might say that we will specifically ask the court to penalise them financially if they continue to ignore any attempts to engage.

Examples of offers that we regularly use are “Calderbank Offers” and “Part 36 Offers”.

These offers carry with them potential adverse costs consequences to a party who refuses to accept them.

Compromise

Quite often one party is prepared to compromise on what they are legally entitled to in order to remove themselves from the situation.

If that is the case, a properly worded offer could be the key to resolving things

Independent Legal Advice

We will also recommend that the other party takes independent legal advice on the situation.

Some people are worried about the other party doing that as they worry that it will lead to an increase in the costs that they will have to pay.

It’s A Good Thing

However, in my experience, it is often the case that things go much smoother once the other party instructs their own solicitors because usually those solicitors will look at the merits of the situation and the arguments that we have previously put forward.

After they’ve done that, we’d hope that they will advise the other party that it would not be in their best interests to resist the sale of the property any further.

What usually happens, once solicitors are instructed on the other side, is that negotiations take place resulting in a full and final settlement of the matter to give the parties a clean break.

It might be that we are able to document the terms of settlement in a short agreement with them.

Yes, it will cost a bit to negotiate with those solicitors and to document a settlement, but that is likely to cost much less in upfront fees than applying to court.

What Else Can We Do?

You might have guessed from this article that as solicitors we are very keen to avoid the need to go to court to resolve situations such as this if we can.

That is very much the case, and one further method we use is mediation.

Parties are encouraged to use a form of Alternative Dispute Resolution (“ADR”) before issuing proceedings at court, and can sometimes be penalised for not doing so.

Mediation

Mediation is an excellent form of ADR.

It’s very flexible and can range from the parties meeting around a table to negotiate a settlement in person, to being carried out completely remote with no contact between the parties at all.

It has around an 80% success rate, so the costs of forcing the sale of a jointly owned property can be reduced significantly if this option is pursued before issuing proceedings at court.

What If We Need To Apply To Court?

In the unlikely event that you need to apply to court to force the sale of the property, the costs will again be determined by the facts.

Sorry about that!

If it is quite simply a case of the court having to determine whether or not the property should be sold, the costs involved could by quite modest.

If there is a dispute of fact, perhaps relating to the parties’ respective shares of the equity and the amount that they are each entitled to from any sale proceeds, the costs required to resolve the matter will be more given that more work will be required.

We Might Still Settle

What I would say is that even when we are required to issue a claim at court, in most cases we will still reach a compromise during the course of those proceedings without the need to attend a final hearing.

That is because the act of actually taking someone to court can be the tipping point that finally brings them to the table.

The costs involved are obviously reduced when this happens.