I'am getting a divorce

If you are going through a divorce and both you and your ex-partner’s names are on the mortgage, you are both responsible for paying the mortgage until a financial settlement is reached. This is true, even if one of you has moved out of the family home. When two people take out a joint mortgage, both agree to be equally liable for the debt until the mortgage is paid off, not just while you live in the property. Missing payments will damage your credit score and that of your ex-partner. In the worst case, it could lead to repossession of the property.

How can the home be divided in a divorce?

It can be a challenge working out how the home should be divided if you’re getting divorced. Generally, there are three options open to you:

Sell up and move out

If you both move out of the property, you can sell the house and pay off the mortgage. Selling is often the neatest way of moving on after you separate. In these circumstances, any equity left after the mortgage has been paid off will be considered a marital asset and split between the two of you. Exactly who gets what from the leftover funds can be open to dispute. Agreeing between the two of you who gets what is often the quickest and cheapest solution. If you cannot reach an agreement, then the matter will need to be settled in the divorce court, in which case you need to get legal advice about your rights.

Continue to pay your existing mortgage jointly

If one of you wants to stay in your formerly shared home, you could continue paying the existing mortgage between you, especially if you have nearly paid it off and you’re still on good terms after the divorce. Continuing with the mortgage can also be a good option if you have children because it avoids them having to move out of the family home. However, you might need to set up a Mesher Order through the courts. This will state that the home cannot be sold until after a certain time or a specific event – for example, after the children have left school. At this point, the property would be sold and the sale proceeds divided between you. Before choosing this option, you will need to make sure that both you and your partner can continue to afford to pay the mortgage and any other living costs.

Buy your partner out

Another option if one of you intends to stay living in the home is to transfer sole ownership to the occupier.
  • Transferring the mortgage into one name will involve one partner buying the other’s share in the property, including their equity.
  • You will need to prove that the occupier will be able to afford the mortgage on their own – remember, the existing lender is under no obligation to remove either of you or to transfer the mortgage to one name.
  • If your lender believes you can afford the mortgage, it may agree to you becoming the sole mortgage holder.
  • You will then need to buy your ex-partner’s share in the property before the mortgage can be put into your name. This may involve getting the current value assessed to determine the level of equity in the property.

    Make it part of the settlement

    you can arrange for one of you to keep the house while the other receives other assets from the marriage to the equivalent value.

    Let the court decide

    if you can’t come to an agreement, the court can decide for you. If there are children, the judge will usually seek the option that causes little disruption for them as possible. To do this, you’ll have to apply for a financial order, so it’s a good idea to get legal advice to guide you through the process.

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