Equity release as a means of settling divorce dispute over house?

charliesnanna

My partner's ex wife lives in their jointly owned house. He is reluctant to force her to move but wants his share of the equity. They have never yet taken this matter to the courts. Would anyone know anything about whether equity release may be a solution?

EdInvestor

Even quite elderly people can only usually release a maximum of 50% of the value, and if she is in her early 60's, say, it would be more like 20-25%.Selling the property and splitting the proceeds would be much better. Could she perhaps raise a mortgage for the amount and take a lodger to help with the repaymentys?

homer_j_3

The most common way in these situations is to do a transfer of equity. This is where your partner will agree with his ex to take his name off the mortgage and property (thus surrendering any rights) for a payment for his contribution to the house/mortgage etc.

His ex will need to be in agreement with this and they must be able to agree an amount that he is due. This is where it can become difficult and may take the courts to resolve.

His ex will also need to have the affordability with the lender to be able to sustain the mortgage on her own. If she cannot afford the mortgage in the lenders eyes then she will not get it agreed.

The cost to do the transfer can be a few hundred pounds due to need of solicitors and can be fraught with problems with either the 2 parties not agreeing or the lender refusing to help.

If they are amicable and they are both prepared to work an agreement out then all you can do is speak to the lender.

Some may suggest getting legal advice and it could be worth to ensure there is no comeback but it all depends on what you partner is comfortable with.