husband & i split. i want to take over mortgage

jamminjamaica

hi

husband and i have split and i want to take on the mortgage in a years time, but worried i wont get assessed for the remaining balance with what i earn. what will the mortgage company do? I am already making all the payments myself but all the calculators out there state that my maximum borrowing will be a lot less that the balance on my mortgage.

currently still owe £115000 on a house of £175000. i only earn £15500 per annum and also get £242 a week for tax credits.

what are my options?

opinions4u

what are my options?

Limited.

I would suggest that you see a whole of market mortgage adviser first to see if there is any way that they can source a mortgage for somebody so reliant on tax credits. I suspect they'll struggle, but you do have equity on your side.

Assuming, in principle, you can get a mortgage you then need 2 things.

1) Your husband's agreement. He would effectively be handing you all the equity.

2) Legal advice on everything to do with the separation.

Good luck.

(By the way, if a new government changed the allocation of tax credits downwards, how would you cope? Don't rule out selling up and moving to a smaller house as an option).

jamminjamaica

he wants out. and i am taking on the debt so he can walk away. i will retain the equity on the house. just worried that in a years time when our current deal runs out.

sammyjammy

jamminjamaica wrote: »

hi

currently still owe £115000 on a house of £175000. i only earn £15500 per annum and also get £242 a week for tax credits.

what are my options?

do you really mean £242 a week?

jamminjamaica

sammyjammy wrote: »

do you really mean £242 a week?

yes i get £242 a week tax credits (working and child)

chirpchirp

I'm in much the same situation as you. My mortgage company won't allow my ex to come off the mortgage so I continue paying it and he is still equally liable should I default as far as the mortage company is concerned. Our two year deal came to an end last year but I continued with the same mortgage. Just because your deal ends doesn't mean you have to change mortgages. I was on a fixed rate which reverted to a tracker. Have you checked what you'll be on when your deal finishes?

Only some mortgage companies will take into account working tax credits and I believe YBS is one of these. However, you end up paying a higher rate of interest in most cases to have your tax credits included. My ex and I came to the conclusion that it was better for me to stay on a lower rate of interest or else I would need to take him back to court to increase maitenence.

jamminjamaica

chirpchirp wrote: »

I'm in much the same situation as you. My mortgage company won't allow my ex to come off the mortgage so I continue paying it and he is still equally liable should I default as far as the mortage company is concerned. Our two year deal came to an end last year but I continued with the same mortgage. Just because your deal ends doesn't mean you have to change mortgages. I was on a fixed rate which reverted to a tracker. Have you checked what you'll be on when your deal finishes?

Only some mortgage companies will take into account working tax credits and I believe YBS is one of these. However, you end up paying a higher rate of interest in most cases to have your tax credits included. My ex and I came to the conclusion that it was better for me to stay on a lower rate of interest or else I would need to take him back to court to increase maitenence.

thanks for your message. at the moment my banks standard variable rate is 2.50% mortgage is currently on 5.09% i hadnt thought about just letting the mortgage to revert to the standard rate. i have 18month left on the current deal. hopefully there will not be much of a shift in interest rates but i think that could be my best option. i guess i will just have to wait and see what happens with the interest rates.

dmg24

jamminjamaica wrote: »

yes i get £242 a week tax credits (working and child)

How old are your children?

chirpchirp

Some things to bear in mind:

1. Do you get maitenence for your children or for yourself?

2. If you see a solictor, you may not need to pay your ex his equity until your children have left school.

3. If you overpay, by the time you go on the SVR or the mortgage rates increase you may be able to reach the mortgage multiples in your own right.

I had written this much better, but lost it, oh well hope the above gives you something to think about.

dimbo61

But if you overpay the mortgage once it drops onto the SVR at 2.5% then at some time in the future your EX turns nasty and wants a share you have more equity in the property and he could get a bigger slice of the profit!
So if you do see a drop in your mortgage costs then fill a cash ISA hopefully paying more in interest than your SVR mortgage .

chirpchirp

Dimbo's right about the overpaying. In my situation I own the house (welll once paperwork is sorted!) and ex has a percentage charge on the property which allows me to overpay - but he remains on the mortgage until the mortgage company will take me on in my own right.