Options when separating from partner

smiddle3

Hi,

My partner and I have recently separated having moved into our first house together 6 months ago. The house was bought for 120k with a roughly equal contribution of 6k each towards the deposit. We are yet to decide on what to do about the house. The way I see it we have the following options:

- Sell the house (with this option we would need to pay a settlement of around 112k including ERC. We havn't had it re-valued but I would imagine taking into account selling fees aswell we would be left with next to no equity or, more likely, owing money)
- Rent it out (we are still on good terms and this would make more financial sense I would imagine but I also imagine there are some who have tried this with ex partners and things have turned sour down the line - thoughts on this option?)
- One buys the other out (my ex would not be interested in this option and I would probably only consider this if I were able to let it out in the near future as taking on the full mortgage+bills would seriously cripple my finances - anyone had experience of this or have any thoughts?)

Cheers

Dan-Dan

Sell, clear any debts, move on

Its the only way to ensure a good clean break and without a massive millstone round your neck

Alter_ego

Sell, if either of you wants to mortgage with a new partner the extra 3% stamp duty will bite you.
The same without a new partner of course.

Pixie5740

My personal view is that when I relationship ends it's best to sever financial ties no matter how amicable the split. You don't want to be left in a situation years from now where you're stuck from moving on because you're still financially linked and have equity tied up in the property.

Option 1: You'll sever the financial link but will probably lose all your equity in ERC and solicitors and estate agent fees.

Option 2: Dependent on your lender granting consent to let so soon after taking out the mortgage. Leaves you financially linked to your ex.

Option 3: Not hugely different from Option 1 really as in order to buy your ex out you would need to get a new mortgage in your name only and repay the joint mortgage which will result in ERC.

How long would you have to wait before you wouldn't have to pay ERC? How big is the property (how many bedrooms)?

HappyMJ

smiddle3 wrote: »

Hi,

My partner and I have recently separated having moved into our first house together 6 months ago. The house was bought for 120k with a roughly equal contribution of 6k each towards the deposit. We are yet to decide on what to do about the house. The way I see it we have the following options:

- Sell the house (with this option we would need to pay a settlement of around 112k including ERC. We havn't had it re-valued but I would imagine taking into account selling fees aswell we would be left with next to no equity or, more likely, owing money)
- Rent it out (we are still on good terms and this would make more financial sense I would imagine but I also imagine there are some who have tried this with ex partners and things have turned sour down the line - thoughts on this option?)
- One buys the other out (my ex would not be interested in this option and I would probably only consider this if I were able to let it out in the near future as taking on the full mortgage+bills would seriously cripple my finances - anyone had experience of this or have any thoughts?)

Cheers

Very likely you will be left with nothing if you sell.

Buying a house is a long term investment it's not going to get you your money back after 6 months so unless one of you can buy the other out then selling is your only option. You do not need to pay £6,000 to buy the other out. You pay what half what you would get if the property was sold and the equity split...i.e £1.

Being a joint landlord is in my opinion is not going to work. You'll have to make joint decisions regarding the property, split income, expenses and profits (if any), you'll be financially tied to each other preventing either of you from moving on. I would not do it.

Ozzuk

Buyout the house, get a lodger for a while. Or sell up at potential loss and be completely free to go anywhere.

tiger_eyes

Take a few days and read through this forum. You'll find many, many, many disaster stories of houses still owned with ex-partners.

tom9980

Option 4 - One buys the other out and rents out spare bedroom(s) to lodgers.

Either way absolutely you want a complete financial split while things are amicable, its often the case an ex can get jealous of new partners and things go from ok to not ok quickly.

[Deleted User]

If you were to rent it out entirely, you'd need to get permission from the mortgage lender - and they might not be keen so early into the mortgage. You can always ask though.

Would it work for you to buy out your ex and remain there with a lodger?
1 - will the mortgage lender allow you to take on the full mortgage, presumably affordability was based on both incomes?
2 - will having a lodger work for you financially? Have a look into the local rental market, and bear in mind that most people would expect to pay less as a lodger than as a tenant in a flatshare, due to the lower security this offers.
3 - will having a lodger suit you personally? (or perhaps, what sort of person and ground rules would suit you and them and make it harmonious)

xylophone

From reading other posts, I have formed the strong impression that remaining linked to an ex partner through property ownership is a one way path to a vale of tears and a mire of grief.

If you wish to keep the property, buying him out and taking a lodger to help with the bills would seem a good option.

https://www.gov.uk/rent-room-in-your-home/the-rent-a-room-scheme

hazyjo

Can you get the mortgage on your own? Are you on a fixed rate? I would opt for 'sell'. Definitely don't want any financial ties to your ex. It will get messy if one of you meets someone else. Plus, if there's a big expense with the house and one is skint, it'll cause probs as you'll both have to pay.


You may find you're unable to sell until you've owned it a year - not sure if that's law or not, or just hard for others to mortgage.


Jx