Financing new home after divorce

aleaman

Hello all,

New here, so apologies in advance if my existing searches for relevant threads has been too light.

Advice/thoughts sought on ideas for refinancing to allow for me to buy a home, while retaining the existing family home.

Here's the bullet points of the current situation:
Recently divorced (amicable - so no issues on discussing finances, nor on shared finances for the future).
Family home value 300k
Current mortgage 115k (interest only - inheritance due to pay off)
Current rate 5.65 (2 years left on 5 year fixed)
Approx 5k buy out penalty
I'm renting (500pcm)

Initial idea is as follows:
Remortgage current home to get capital for me (taking advantage of current market rates being significantly lower than our fixed).
Obtain 2nd mortgage for balance of purchase price of my new home.

Monthly total mortgage budget is circa 1000 (from my rent plus existing interest payments) - though would prefer to reduce this to allow for interest rate increases in the next couple of years and/or overpayments on 2nd home.

Initially favouring fixed deals (circa 2 years) to give simpler budgeting for both of us (relatively risk-averse).
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So... does all this sound like a good idea?

Should the remortgage of the current home be in both names?
Should a 2nd mortgage be in both names?

Are there better ways to refinance in order to keep the existing home and get a second place for me?

Not sure what other info may help, so am happy to answer questions.
Many thanks in advance.
Al

aleaman

97 views, no replies.
So I'm guessing that no-one has any input.

By subsequently talking to a number of high street banks, it transpires that none of them are willing to re-mortgage as a joint application, and thence consider my outgoings of 'maintenance', and the existing mortgage payments (which I still cover) are too high to offer me much in the way of a new mortgage.

So, for now, I can't get any of 'my' capital out of the house!
I never thought that it'd be this difficult. Especially as even with an amicable divorce, we are now too risky! The true madness being that since the split and change of tax credits situation, we are effectively 800net a month better off! Utter, utter madness in itself. But doubly so as none of the banks will consider this.

A.

Thrugelmir

Why not sell the existing property to release some equity or reduce the existing mortgage committment ?

£800 a month better off maybe, but with 2 properties to maintain and higher interest rates in the future. Not as rosy as it may seem.

Thrugelmir

aleaman wrote: »

97 views, no replies.
So I'm guessing that no-one has any input.

Always bump your posts if they're not answered. Sometimes a post can rapidly disappear down the pages.