Remortgaging with new partner after breakup - where do I start?

lou-rose

Hi, Can anyone help answer a few questions for me please

I bought a house 10 years ago for 95k with my ex partner. We split up fairly amicably and at that point owed about 47k, so between us we owned half the house. House deeds are agreed at a 50/50 split, so we agreed that I pay him a quarter value we paid for the house to buy him out, when I could afford to, but nothing was agreed legally. At the time of breakup, the house was valued at 80k, so to sell then would have meant us both losing everything we had put in.

I stayed in the house with our child and he moved out, I have been paying all the mortgage in that time while he rents. Going by similar sales in the area it is again worth around 95-100k. I am now in a position to buy him out finally with my new partner, but where do I start? Do I go to solicitors first? Do I try and apply for new mortgage so I know we can get the finance first?. It will be the first house for my new partner who will be providing the main income, so is it classed as a remortgage or first time buyer? Would I be able to keep my existing mortgage and just swap the names on it? Will I have to go through all the legal searches again given I already have all the paperwork for the house, or will it be more straightforward this time?

I just have no idea where to start and it's stressing me out so much, so any help would be appreciated, thanks

HappyMJ

You'll need to get a new mortgage and change the title deeds if you're changing the ownership of the house.

Your new partner is effectively buying half of your house from your ex-partner. SDLT may be payable on that transaction.

You don't need to do the full purchase thing. You know the house already. The purchase decision doesn't depend on searches.

If your ex-partner is willing to sell his share to your new partner and co-operative you won't need solicitors either.

So...what I would do...the both of you should approach a mortgage broker and look for a new mortgage before you start the process and see if you actually qualify as a couple for a mortgage. If that's a non-starter well there's not much you can do. You could sell and rent a property together instead until your joint credit improves.

Diablo_Nero

It's a Nightmare. My circumstances are similar, and I approached the land Registry to take my ex-partners name off the 'Deeds', having bought her out. The Land Registry said I need my Mortgage Companies agreement/permission (By letter), even though the Mortgage is under £70k on a £200k property.
So fair enough, I ask my Mortgage Company for permission. They put me through a feasibility test to see if I could pay the mortgage with my ex-partner now not contributing.
Even though she had not contributed for 5 years, they decided my finances were not good enough. They acknowledged I had been paying, and would continue to pay, but that due to the financial crisis, lending criteria had become stricter.
I asked what I could do, and they said carry on paying (with my ex-partners name still on the Mortgage & Deeds), or sell up. I complained, nicely, asking if a Manager could assess it all afresh. They did, and sent me a letter acknowledging I was in a Catch 22 situation, and although they had sympathies for my plight, they were unable to help at this time.
Hope you fair better?

lou-rose

Diablo_Nero wrote: »

It's a Nightmare. My circumstances are similar, and I approached the land Registry to take my ex-partners name off the 'Deeds', having bought her out. The Land Registry said I need my Mortgage Companies agreement/permission (By letter), even though the Mortgage is under £70k on a £200k property.
So fair enough, I ask my Mortgage Company for permission. They put me through a feasibility test to see if I could pay the mortgage with my ex-partner now not contributing.
Even though she had not contributed for 5 years, they decided my finances were not good enough. They acknowledged I had been paying, and would continue to pay, but that due to the financial crisis, lending criteria had become stricter.
I asked what I could do, and they said carry on paying (with my ex-partners name still on the Mortgage & Deeds), or sell up. I complained, nicely, asking if a Manager could assess it all afresh. They did, and sent me a letter acknowledging I was in a Catch 22 situation, and although they had sympathies for my plight, they were unable to help at this time.
Hope you fair better?

I feel for you, hope you manage to sort something out. That situation is exactly why I've put it off for so long. Despite being able to pay the mortgage by myself, as a single mum on minimum wage, there's no way I would have been able to remortgage by myself. It's nice to see they let you carry on with what you had been doing though, I was scared that if they accessed my situation then they'd just tell me that I couldn't afford it and they'd withdraw the mortgage, forcing me to sell (I have no idea if they can do that or not, but it was mainly based on my ex's income).

I'm lucky that my ex has been so patient and not wanted to buy his own house in that time. If he had, then I would have been screwed, as he wouldn't have been able to get a new mortgage with his name already on this. My current partner has a fairly decent job compared to me, but mortgage lenders were wanting ridiculous incomes for a while.

Interesting to hear that I wouldn't need solicitors though, I thought I would need them to prevent any disputes in the future.

lou-rose

HappyMJ wrote: »

Your new partner is effectively buying half of your house from your ex-partner. SDLT may be payable on that transaction..

I never heard this had changed, so it seems everyone has to pay stamp duty now? I suppose that's fair but that's an expense I hadn't thought about.

Edit: I just looked on HMRC and it's over 125k, fairly sure the full value of house is less than that, so we should be ok. Annoying that you don't have to pay when splitting from a married partner, but do if 'only' living together.