Marriage split - mortgage advice please

Anastasia

Hoping someone can point me in the right direction and give me some ideas as OH is useless when it comes to finance.

This is the situation:

Borrowings:
Current mortgage £49,000
Credit cards me 1. £1,400 0% interest and 2. £5,000 on 0% deal just come to an end

Credit cards him £5000 on 4.9% interest for life
Car loan £4000 left to pay

Monthly debt repayments excluding mortgage total £550

Earnings:
Me 27,000
Him 19,000

House value in the region 0f £170,000 (not had it valued yet)
He wants to buy a house for around £120,000

Questions:

How do we start this process? What should be our first steps? Should we remortgage our current house together and then put the house in my name and then put the deposit down on his house. I have known people who were not able to get a mortgage on their own because they were named on another mortgage.

Should we take all our information to the building society, tell them the situation and work it out with them or use a broker?
Should we roll up all our debts into a mortgage? How much would we be able to borrow?

I want a mortgage for no more than 13 years. He could have one for 20 years. The whole thing terrifies me as I don't know how we are going to manage. My credit score is 'excellent', I don't know what his is but should be similar as I manage all the finances. Our outgoings are quite high as we have children and run two cars which we both need to travel to work. There is nothing left at the end of the month.

Thanks in anticipation of your support.

Firefly

My ex left never to be seen again and the court awarded the house to me but I was to use my "best endeavours" to remove my name from the mortgage. It's now £58k and up until recently my salary hasn't been enough to allow the building society to remove his name. I've had three interviews with them so far.

They did however, admit that my ex's name on the mortgage was meaningless as he is thought to be out of the country and could easily get another mortgage on his return to the country without reference to this address.

Have you taken advice from your solicitor? The name on the mortgage is secondary really to who owns the house. You need a solicitor for this. IMHO your ex will struggle to get a house for £120k with a £19k salary and no deposit. Stick to your guns though and don't give too much away.

Good luck.

PS just realised I didn't comment on your debt. You keep yours, he can keep his. Your salary should cover it if you manage carefully with advice from DFW's and you would always have the option of remortgaging to release equity if of course, it ends up as your house!

Anastasia

Thanks for that.

My plan was to remortgage this house to release equity to put down a large deposit on his house. Effectively buy him out. Not sure about this now.

Prudent

Have you seen a solicitor? I would strongly advise you do. Finances in a split involve more than the most pressing issue -which is usually the house. You need to look at all assets before you make decisons and this needs to include pensions. If you both write to your pension providers they will send back at statement of the value of the fund. It took my provider around three months to do this.

At the simplest level you need to put assest in two columns - yours and his. You may have already agreed on who is having certain things- you need to place the value of these things in the respective columns to get a fair picture. Once you have done this, you can either choose to subtract the debts from each coloumn, or simply agree to be responsible for your own. This will give you a much fairer starting point.

If after looking at this you want to buy his 50% of the house equity, you know what will be fair. If he is taking most of the furniture and the most expensive car - you may want to give less than 50%.

Remember this is a very simple starting point. There maybe other issues like one of you putting in money you had saved prior to the marriage, inheritances etc.

Work out this information, try and come to some agreement, but do check out with a solicitor it is all fair.

Lizzybet_2

I was in similar situation a few years ago. Basically we had the house valued by three agents, and averaged out the valuation. Obviously we knew what deposit we had put down, and deemed this to have been joint 50:50. I then borrowed the additional money to buy out my husband's share of the property, and he used that as deposit and got a mortgage to buy another one. It's always good to see a solicitor, but be prepared that he/she will be acting in YOUR interests only, and this may mean that the arrangements end up less amicable than you may wish. I think the best rule is just try to be absolutely fair.
PS It will get better!!

Gorgeous_George

By the sounds of it, he needs to see a solicitor more than you do!

If your marital home was worth £170K with a £49K mortgage, that's about £60K each in equity. He should be able to get a mortgage at just over 3 times his salary (with a £60K deposit).

You'd need £110K mortgage to stay where you are. That's 4 times your salary so you may find it more difficult than he will but should be ok.



GG

JennyW_2

I cant add to the great advise you've been given but wanted to confirm that you should involve a solicitor.

Me and an ex-husband had to sort out a house and there is a lot more involved than you first realise, especially when it gets a bit nasty. No matter how well you get on now, things always go bitter. Seek legal advice.

Anastasia

I really appreciate everyone's input on this. Have a very clear message to get legal advice. The one thing I am worried about is my pension because mine is better than his - paid into it for longer.