Depending on the mortgage (endowment/repayment) and whether it can be passed over to her, then that sounds, unfortunately, fair. She gets a 150,000 house, with 23 years left on a 25 year mortgage. The alternative is the house is sold, the solicitors etc. take their cut, rent is paid for the time it takes to complete the sale (average of 3 months in the UK at the moment, which means half of them take longer (ish!) or you cut the price to sell quickly) so the alternative might be to sell it quickly at 130k, pay 10k in sales costs, whatever penalty on the mortgage (3,6 or 10 months interest perhaps) and 3months x 2 rent which will probably leave her with a few grand and nowhere to live.
My friends, when they split, had a mortgage that was more than the house was worth. He wanted to keep the house, and she wanted to be bought out of her negative equity so he ended up giving her several grand to buy her half of the negative equity! Otherwise she was quite prepared to force him to sell and have them both be a few grand out (not a friendly divorce). He figured that since it would cost him the same either way, and one way he kept the house with an endowment that was a few years old, that that was by far the best suggestion ...
... in your S-I-L's case, she has (I suppose) the right to half the house (50k of the original price) and now, by paying the extra 25k she will have 100% of a 150k house, that sounds like a storming good idea. The banks should be ok (aside from her income) buying the house since she's effectively the owner of a 150k property where the maximum the mortgage should be is the 100k from before plus an additiona 25k (so still only 125k out of 150k so they are easily covered and it's less than 90%). If they put down a decent deposit when they bought the house (so that the mortgage plus 25k comes to less than 75% of 150k) she should get a really good rate from the bank/building society and if she plans to live there for a while she could go "interest only" on the mortgage with the idea that in 25 years she could sell this house to pay off the capital and use the increase in value to put down on the next place (or as salaries increase she could start another investment vehicle ISA/Tessa/whatever sort of thing plus premium bonds, lottery tickets etc. to build up a capital sum to pay off the mortgage capital amount, however IANAPIABIPOOTV!)
Her alternative is to walk away and have him pay her 25k (or whatever) but I don't think that's as good a deal.
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Depending on the mortgage ...
My friends, when they split, had a mortgage that was more than the house was worth. He wanted to keep the house, and she wanted to be bought out of her negative equity so he ended up giving her several grand to buy her half of the negative equity! Otherwise she was quite prepared to force him to sell and have them both be a few grand out (not a friendly divorce). He figured that since it would cost him the same either way, and one way he kept the house with an endowment that was a few years old, that that was by far the best suggestion ...
... in your S-I-L's case, she has (I suppose) the right to half the house (50k of the original price) and now, by paying the extra 25k she will have 100% of a 150k house, that sounds like a storming good idea. The banks should be ok (aside from her income) buying the house since she's effectively the owner of a 150k property where the maximum the mortgage should be is the 100k from before plus an additiona 25k (so still only 125k out of 150k so they are easily covered and it's less than 90%). If they put down a decent deposit when they bought the house (so that the mortgage plus 25k comes to less than 75% of 150k) she should get a really good rate from the bank/building society and if she plans to live there for a while she could go "interest only" on the mortgage with the idea that in 25 years she could sell this house to pay off the capital and use the increase in value to put down on the next place (or as salaries increase she could start another investment vehicle ISA/Tessa/whatever sort of thing plus premium bonds, lottery tickets etc. to build up a capital sum to pay off the mortgage capital amount, however IANAPIABIPOOTV!)
Her alternative is to walk away and have him pay her 25k (or whatever) but I don't think that's as good a deal.