Marriage breakdown forced to sell in negative equity

Jasthacat

My husband and I brought our flat back in 2007 on an interest only mortgage. Due to the breakdown of our marriage I moved out in January this year. He stayed at the flat, took a mortgage holiday while sorting his finances and is now paying for all the mortgage/maintenance costs etc himself.

When we broke up we both assumed that once the dust had settled he would be able to take on the mortgage fully his name, releasing me to be able to get my own mortgage. He has just heard back from NRAM today that they will not give the mortgage out to a single occupant and that the flat has to have a dual occupancy to have a valid mortgage. Although he tells them he has been paying for this for the last 3 or so months all by himself they won't accept it. They won't accept a guarantor, they will only accept him for 75k of the mortgage.

The mortgage is 138k when we last had the flat valued in December 2012 it received good feedback but estate agents only have it the best value of 129k. Our neighbour has their flat on the market for £132k. Although it is a slightly higher standard then ours it does need a small bit of "rejigging" with the lay out so could be that it's marked down slightly for that and ours might be at least 132k if not a bit more.

My two concerns are that 1) I am currently renting a one bedroom and it costs more then the mortgage on our 2 bed flat does so ideally want hubby to stay there as he has a child from a previous relationship and its more cost effective for him.. And 2) I obviously don't want to be in debt. I just managed to clear all my debt last last year (other then my credit card which has a small amount on it) renting is expensive and things are tight as they are at the moment as well as then having to clear the negative equity plus any fees that are added.

Is there anyway around this? He's going to speak to a Financial Advisor this week. It seems stupid for him to lose his home. We both earn good wages. We have also both moved on with new relationships so living together is not an option (and neither of us want to).

Can he remortgage with no equity and no deposit? Can NRAM discriminate against single occupants! There must be loads of people who have single occupancy mortgages?

kingstreet

It's unlikely to be the number of occupants. They are refusing the transfer of equity because of the negative equity and possibly because his income does not justify the amount of borrowing outstanding.

He will not be able to remortgage in such circumstances. The only way you can be released form the mortgage is for the property to be sold and to do so at a price below the outstanding mortgage amount requires the prior agreement of the lender and a plan to repay the shortfall after completion.