Some mortgage advice

sadkipper

Hi

My husband has decided to end our marriage and I need some help on how best to sort out the mortgage. We currently have a First Direct offset mortgage and owe around 90k on a very good interest rate. We can borrow up to 160k with our current arrangement. My husband wants me to give him 50k which I could do within the current arrangement but I would also want to have the mortgage in my sole name.

Does anyone know what FD are likely to want to do in this sort of situation? My ideal would be for me to take over the whole mortgage (I believe I earn enough to do this and there is 200k equity in the house). The main reason is so that I can keep the very very good interest rate but would FD see this as a remortgage situation?

If I have to change rates then I am in danger of not being able to pay it off before I retire as I am 52 now.

The other alternative that he has suggested is that he has the money and leaves his name on the mortgage but my concern here is that he may then have rights to more money at a later stage so thats really my last resort.

Thanks for reading and any advice gratefully received.

alleycat`

I suspect to get him off the mortgage and re-do it as you alone it will be a total re-mortgage situation.

I don't think they'll see it as "additional borrowing" where you keep the old part of the mortgage and drawn down some more against a "current" product set to pay him off.

Simon_gloster

Usual practice is to approach them for a transfer of equity.

You run through an application as normal. Whether they ley you keep the existing deal and take the 50k on a further advance rate is up to them. This type would mean you keep the existing mortgahe ac number.

Alternatively is re-writing the whole deal. Raising enough to close down your existing deal and taking 140k on current rates.

If you pay him off but dont transfer him off the deeds, technically he is entitled to half the house still.

If for some reason you are declined, you either remortge and lose the rate anyway or leave everything as it is.

holly_hobby

Yep .. SG has nailed it.

Removing hubby is a Transfer of Equity (TOE) - which will cost circa £400 & lender admin fee (if you remain with current provider).

If you wish to release equity, this is a further advance ( technically a remortgage is when you CHANGE mortgage provider), where by you will be subject to full underwriting and status checks.

Retaining the current rate on the present borrowings, shouldn't normally be an issue, with a rate from their current range selected for any FA effected.

Hubby is released with his pay off and thats that.

If your income is sufficient to release him, but not release any further equity - you can come to an agreement with him OR try and seek and alternative lender whose affordability matrix is more generous - which would be a remortgage.

Although there are various fee free remortgage deals about, these relate to basic tsf of title/LR change only - and any TOE fees will need to be met separately by you.

IF you do need to contemplate an alternative lender, a good whole of market broker will determine the most suitable/beneficial product and lender for your requirements (which bearing in mind the TOE element, MAY not be a fee free rmg deal).

Hope this helps

Holly