Need a 67% LTV mortgage as am separating from my husband - need help!

FOnew

Hi all, I'm in a bad situation. I have 2 children aged 5 and 7. I'm in process of separating from my husband. I've been a stay at home mum working as a part time remote self employed administrator since May last year. Our home was valued at £425,000 and after the separation I will have £140,000 to pay towards taking over the house. I have worked out I'll have an income of around £27,000 a year between my self employed income, tax credits and child support. I need to get a mortgage or find a private residential property investor for 67% loan to value. As I have only been working as part time self employed since May I don't know how I'll get any mortgage as the last 3 years tax returns will show '0' income. I am desperate to find a way to keep our home to minimise disruption and upset for my children and to try and give them as much stability and continuity as possible. I need to be creative, there has to be a way. Help please!!!

Browntoa

You need to see an independent mortgage broker but looking at your income I think you would fail affordability tests for the required mortgage

kingstreet

You need an income of over £70k a year for the mortgage you require and a trading record of at least a year earning that, preferably two with an average of at least that amount.

I don't see a mortgage solution here.

Annisele

I'm sorry; that isn't a nice situation to be in at all.

I'm afraid you're not going to get a mortgage of £285k on an income of £27k. That's more than 10 times income, and would simply be unaffordable.

But - do you really need to borrow as much as £285k? You say the property is worth £425k, but you don't say how much the outstanding mortgage is, or how much you'll be paying your ex. It's possible you won't have to pay your ex his share of the equity until after your children are adults - so if a good chunk of the £285k is for him rather than to pay off the existing mortgage, this might be possible.

theartfullodger

Assuming he has already moved out then I would suggest you leave the ownership & mortgage as they are now: He remains liable to pay all of mortgage (as are you - yeah, weird eh) so he won't want to ruin his credit rating by missing payments. Can't see why you have to (in a hurry) take over all ownership of house & mortgage payments in full.

He could go through the very slow, complicated and painful process of trying to force you to sell but it should probably take years.. See
http://england.shelter.org.uk/__data/assets/pdf_file/0020/23393/ShelterGuide_RelationshipBreakdown.pdf

I think you need in-depth advice from a family law solicitor.

However, with such small (relative) income and no history of declared income to HMRC (sounds odd....) you should prepare yourself for having to move to somewhere cheaper eventually.

Thrugelmir

theartfullodger wrote: »

Assuming he has already moved out then I would suggest you leave the ownership & mortgage as they are now: He remains liable to pay all of mortgage (as are you - yeah, weird eh) so he won't want to ruin his credit rating by missing payments. Can't see why you have to (in a hurry) take over all ownership of house & mortgage payments in full.

If the ex has to fund their own living accommodation then what you suggest may well not be a practical solution. Far better to compromise than create an even more stressful environment for the children.

chelseablue

Sorry to say but if you do need a mortgage of 285k you wont get it earning £27,000


We have a combined income of nearly £60,000 and the max we could borrow was £244,000

FOnew

Thanks all for your input. I will have £140,000 to use as a deposit after we pay our remaining mortgage and debts off. We are still amicably living together but he wants to sell so he can buy a new place. It's ok for him as he has a salary history whereas I don't as I stopped to raise our children full time. I don't regret that for a moment but it leaves me in a much harder position than him. My main priority is keeping good relations as that's the most important thing for the kids but then keeping our home if at all possible. Does anyone know of any private equity investors for residential properties? Thank you.

Brightspark87

Hi You don't want a private equity investor in the mortgage even if it was possible.

He has a responsibility to be able to house you all.

Have you sort legal advice? You need to know where you stand and it may not be possible for him to buy another place at the moment. If that means renting for a few years as horrible as this sounds -this is what can happen.

Annisele

If there is a "private equity investor" for this situation, it's going to be one of your relatives, some future new partner, or your ex.

It's just not an attractive thing for anybody to do on a commercial basis, because there are enormously easier ways of making money. Any private investor isnt' going to want to just lend you money (for the same reason the banks won't - you don't have the income to support it). If the private investor wanted exposure to house prices, they'd just buy one outright - they wouldn't put themselves through the complication and hassle of owning jointly with you.

As others have said, if you haven't already sought legal advice you need to do that. Depending on circumstances, the house might not need to be sold until your children are older, and your ex might have to stay on the mortgage for a while. On the other hand, it might be that you do have to sell - but you can't plan properly until you know your financial position.

FBaby

Frankly I think it is a very risky move to try to get this house of your own. Your income which is not close to being enough to secure the mortgage you need is also unreliable. It is made up of part-time self-employment, benefits (which could be reduced at any time), and child support (what if your OH meets someone rich, and decides to become a stay at home dad and the child support becomes nil?).

Then you have to take into account the cost of the maintenance of the property, how will you afford that?

Have you considered going back to work full-time? If not, then you are safer downsizing. Your children are small, they will quickly adapt to a new home and this one remain only a distant memory. It will be much more important to them to have a happy mum rather than a stressed one if you find yourself in financial trouble trying to pay for the nice house.