Sorting out your joint mortgage after separation or divorce can be tricky. Sadly, around 50% of marriages now end in divorce and as well as the heartache of a relationship breakdown, if you own your home or have a mortgage on it, as well as the upset of possibly leaving the family home, you face the added stress of deciding how to split what is likely to be your biggest asset. These.
Some however offer “Joint Borrower Sole Proprietor” mortgages. This would mean that both Donald and Hilary are liable on the mortgage, but only Donald owns the property. This can work from a lender’s point of view where Hilary is genuinely joining in for affordability, but with no interest in the proceeds of sale (similar to an old style guarantor mortgage).
Sell up and both move out - this would require the mortgage to be paid off from the proceeds of the sale. Transfer the mortgage into one name - this will involve one partner buying the other's share in the property, including their share of any equity involved. The person remaining will need to prove to the lender that they can afford the mortgage.
If your name is on the mortgage, you’re liable for the whole debt, even if it’s a joint mortgage with others. Contact your mortgage lender if you think you might have problems paying the mortgage, or if you are worried that your ex-partner might not make payments they’ve agreed to. The lender might be able to send you copies of statements.
Review your mortgage. Speak to your mortgage lender as soon as possible and they’ll advise you. You and your ex-partner will need to decide if one of you can afford to stay in the family home and weigh up the options. Just make sure you keep on top of your repayments while you try and decide what you want. If you don’t, it could impact on.
Another article on this site, Solutions for Property Division Problems When Unmarried Couples Split Up, discusses how to deal with joint bank accounts, joint credit accounts, and other assets and liabilities. Pay the bills. Make a list of the bills it is essential to pay, such as home insurance, utilities, and the car and mortgage payments.
Splitting up with a partner is always painful. You may be tempted to just walk away without thinking about what will happen to your home if you split up. This isn't a great solution. You could realise years later that you have made a costly mistake, especially if you owned your home jointly.
What you should know about joint mortgage separation.. For example, if you move into a property your partner owns, and you split up a few years later, you won’t have a right to claim a share of the property. This could leave you with nowhere to live.