Transfer of equity following a divorce - advice please

Dragonrider

Hello all,

My ex and I have just agreed our financial split.

I will give up any claim on his pension and he will give up all equity in the house - this has been agreed using both solicitors and mediation, we are both happy with this arrangement, and my solicitor believes the numbers are tipped slightly in my favour.

Current house value is approx 715000, remaining mortgage balance is 354000.

This mortgage is with NatWest, and is fixed at 2.99% until August 2022.

So now I have to set the equity transfer in motion - as I won't pass affordability criteria on my own at the moment (but can afford the repayments with maintenance and tax credits on top of my salary), he has agreed to stay on the mortgage until the fix ends.

At that point, I have a few options:

1. Take over the mortgage on my own (through a combination of overpayments, promotion and a big reduction in childcare costs)
2. Take over the mortgage with someone else - my sister, who earns a good salary but has no dependents, has offered to come on as a silent partner (is this even possible?)
3. Sell the house

But I'm just getting worried that NatWest are going to make me go through full affordability checks now, even though my ex has agreed (it's in writing on the financial consent order) to stay on the mortgage. And that I will be forced to sell the house and uproot the kids just when they are feeling more secure again.

Does anybody know how NatWest will react to this situation?

Many thanks for any advice.

Dragonrider

Thrugelmir

Providing you meet your liability for the mortgage payments. Then the status quo will be maintained.

Suggest you return to your other questions in 4 years time. When there's more certainty. As you say stability for the children is important at this difficult time. Make of the most of the time to plot your future direction.

YHM

As above, maintain your mortgage structure as is, for as long as you can.

Are you sure he will commit to that for another 4 years? What if he wants to get his own place?

Dragonrider

Thanks both.

Can I just confirm that I definitely have to inform NatWest of the transfer of equity?

Just worried they'll put a black mark against my file or something....

Dragonrider

Dragonrider

My ex works overseas a lot, so it's likely he won't need a permanent base here anyway.

YHM

If he is intending on coming off the property deeds, but remaining on the mortgage, this will be an issue for Natwest.

Your solicitors will need to draft something like does not impact on the property ownership, nor the structure of the mortgage.

enthusiasticsaver

So long as your husband remains liable for the mortgage, even with a 0 equity stake then your lender will not be worried about affordability on your own. As far as they are concerned you will still have a joint mortgage and your ex husbands share will be his jointly and several share in the mortgage. He will have to keep his name on the deeds and the mortgage.

If you cannot afford the mortgage on your own then this is where the problems will start. If your sister takes over your husbands 50% share of the mortgage then the property will need to be put into her name too and there will be stamp duty etc etc so it gets complicated and expensive. Your best bet may be to continue as you are if you can afford the payments and then rethink in 4 years time.

Dragonrider

Originally I talked to a financial advisor who said we could change to tenants in common (which we have now done), and then we could specify that one of us had 100% and the other had 0%.

However, my solicitor is now saying that I need to do a formal transfer of equity in order to comply with the consent order.

I dont know who to believe! And just want to make sure I don't rock the boat with NatWest.

Can anyone point me towards some definitive guidance? The .gov.uk website is confusing the heck out of me.

Thanks again,
Dragonrider

YHM

You need to speak to another solicitor really. Get another perspective on that side of things.

dimbo61

NatWest will not allow your EX to come off the mortgage.
You are jointly liable to pay the mortgage.
He will have to wait 4 years unless you both want to pay the ERC ?
Start to consider a cheaper property you can afford with your own income.
Be prepared to put your home on the market in 3.5 /4 years time ! So the sale completes after the ERC ends

Socajam

I would not leave my ex-husband's name on the mortgage, things happen, and people change.
Your best bet will be to go with your sister.
If you husband were to get involved with some, things could get nasty irrespective of what is being determined now.
Get rid of him, once and for all. You do not want to have problems say 4 to 5 years from now.