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What Does Divorce Mean For Your Joint Mortgage?

LATEST NEWS | 02.03.2022

If you are getting divorced from a partner, deciding on what to do with your home can be one of the hardest and most confusing decisions especially if the both of you share a joint mortgage. Your home is your biggest asset so it is important to consider all of the available options before deciding to proceed.

How Does Divorce Affect A Joint Mortgage?

Divorce can be a difficult time both emotionally and financially for both parties involved. However it is important that during this process both you and your partner continue to be responsible for the upkeep of mortgage payments until you have settled upon a decision. Missing payments can be damaging to both of your credit scores and may impact any further financial borrowing, so it is important to maintain. This must continue to be the case regardless of if one of the two of you is no longer living in the property.  If you are experiencing difficulties when it comes to mortgage repayments it is best to speak to your lender. In many cases lenders will be sympathetic to such circumstances, especially if your partner is refusing to keep up with their repayments. Your lender may in such instances be willing to offer some form of repayment relief.   

How Is A Joint Mortgage Dealt With Following Divorce

There are several solutions to consider for your joint mortgage following divorce. Determining the right option for you can be a difficult decision, as splitting financial assets such as a mortgage can be much more complex than just dividing them evenly. Especially so if there are children to consider.   

Both Parties Continue With Monthly Mortgage Repayments

You have the option to continue to make your mortgage repayments as you did whilst married. This is potentially a good option if one of you wants to remain in the previously shared home. Those with children who are on good terms will often choose this route, to offer them more stability. There may be legal requirements to put in place however for this option to work.  For example a Mesher Order via the courts may need to be set up in order to prevent the house being sold before a particular event such as a child turning eighteen. After selling the house the profits will be split evenly between both parties.   

Buy Your Partner Out Of The Property 

Alternatively if you want to keep your property but your partner does not it is possible to have full ownership of the property transferred over to you. This means that you will buy your partner out of their share of the property ownership. It is vital that you are able to prove to your lender that you are able to afford the cost of the full monthly mortgage payments. If your lender approves this, your next step is to get the property valued. This is to ensure the level of equity in the property is sufficient enough to provide the exiting party with their share.   

Both Parties Agree To Sell

If neither one of you intends to remain in the property your best option may be to move out and sell. This is perhaps the easiest way to divide funds after you both separate. Selling will allow you to pay off the mortgage and equity released in this process will be split between both parties. These funds can help to mobilise each individual to buy their own property going forward.  Sometimes under these circumstances there may be disputes around the left over funds. In which case proceedings may be carried over to be settled in a divorce court.  If you are currently in the process of dividing your assets in a divorce and need advice when it comes to your joint mortgage, then get in touch with one of our expert advisors today. 
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