Remortgage / Buying ex out of property

JTH1980

My partner and I are currently in the process of buying her ex out of the property. They have a consent order saying they are both entitled to 50% of the property. My partner and I recently saw a mortgage advisor, everything went well, and the house is currently being valued.

We are trying to work out how much we need to borrow, the figures are as follows:

House Value £100,000
Outstanding Mortgage £35,000

Meaning, £65,000 to be split between my partner and her ex.

As there is still £35,000 outstanding on the mortgage, does half of that debt get taken away from the amount we need to give her ex? Meaning we would need to borrow £35,000 + (£32,500 - £17,500) = £50,000. This was suggested to us by the mortgage advisor.

Those are just ball park figures, I know there are other things to consider, just trying to get my head around the calculation of how much we will need on top of the outstanding mortgage.

Any advice would be appreciated.

kingstreet

No.

The equity is £65,000, so you need to raise half of that to pay off the ex. That's £32,500.

The existing mortgage is £35,000, so you need to pay that off too.

So, the new mortgage amount is £67,500.

If you wanted to factor-in the existing mortgage, then your base would be the full property value £100k, not the equity.

~Beanie~

I would say that you need to give £32,500, which is half of the equity in the property using the figures you have supplied. Plus the £35,000 to pay off the existing mortgage and you need to borrow £67,500.