Mortgage but split up with partner. Advice appreciated.

Caroline_83

Hi guys,

My partner and I bought a house this year (we completed in July). He decided to end our relationship at the beginning of October. We have lived amicably within the house for the last few weeks but I'm not coping so well with this set-up and feel that I could do with living apart from him.

I'm not very savvy in terms of what my rights are or how things will work with the mortgage so I could really do with some help and advice. I'm sure there are others that have had a similar experience.

I earn a reasonable wage so could cobble enough money together to find a rental property and live comfortably on my own. But I couldn't afford to continue with my share of the mortgage repayments on top of that each month.

Any idea what I could/should/need to do?

Thanks in advance.

Caroline

bertiewhite

Where do you want the replies - this thread?

Or this one https://forums.moneysavingexpert.com/discussion/comment/75101422#Comment_75101422 ???

Caroline_83

I was planning to check back on both 😬

Edi81

Please don’t have two threads. This is very mortgage specific so you will get more relevant advice here.

Firstly, in the eyes of the lender is there no your share and ex partner share. You are both liable for the mortgage. Could your ex buy you out? If not, alternatives could be renting out a spare room to cover some of the mortgage or you will need to sell (and take the loss as it’s unlikely that you will have made money once estate agent and solicitors have been paid for).

TrickyDicky101

Can your ex service the mortgage solely on his own? If not, and as already mentioned, should the mortgage fall into arrears then the lender can come after one, the other or both of you to settle the debt.

AnotherJoe

EIther you sell it and split the money returning the deposits or one of you buys the other out, if one of you can afford the mortgage.

Caroline_83

Thanks for your input.

Am I right in thinking that by buying the other out means looking at taking the mortgage out alone? As in applying all over again for the mortgage? I don't think either of us could borrow enough to buy the house alone. Or does it just mean our current lender will look at (say me) my finances to check I could cover the repayments??

TrickyDicky101

Caroline_83 wrote: »

Thanks for your input.

Am I right in thinking that by buying the other out means looking at taking the mortgage out alone? As in applying all over again for the mortgage? I don't think either of us could borrow enough to buy the house alone. Or does it just mean our current lender will look at (say me) my finances to check I could cover the repayments??

If one of you buys the other out it is called a "transfer of equity".

It will mean the lender (whether existing or new) performs a full affordability assessment on just one of your earnings (ie whoever is doing the buying).

Should the one buying out the other need to borrow more (eg to cover the share of the property being bought) then you will be assessed for affordability on the sum of the existing loan plus the new borrowing.

Or you can leave things as they are and you move out. You remain fully liable for the mortgage, however, and should your ex not pay you remain liable for the consequences (eg lender chasing for arrears/loan settlement).

This is why it can be risky not settling things now - you will remain linked to your ex.

Caroline_83

That's exactly the info I was looking for, thank you!

Also, say he buys me out, they would do the affordability assessment on him etc but in terms of me getting any payout (if at all) how is that likely to be calculated? Would it be as simply as whatever I have paid in so far if the value of the house is considered to be the same as when it was bought?

Sorry for sounding daft. This is all new to me and aside from it being my dream home, I don't want to be completely out of pocket but I absolutely need to leave. Or he could leave! But we'll stick with the scenario being me leaving for simplicity sake.

TrickyDicky101

Caroline_83 wrote: »

That's exactly the info I was looking for, thank you!

Also, say he buys me out, they would do the affordability assessment on him etc but in terms of me getting any payout (if at all) how is that likely to be calculated? Would it be as simply as whatever I have paid in so far if the value of the house is considered to be the same as when it was bought?

Sorry for sounding daft. This is all new to me and aside from it being my dream home, I don't want to be completely out of pocket but I absolutely need to leave. Or he could leave! But we'll stick with the scenario being me leaving for simplicity sake.

Well, how much you might get is down to what the property is currently worth, how much the outstanding mortgage is, and ultimately what you can agree between the two of you.

If the property has increased substantially in value then you'll want some share of the gains.

If it hasn't increased at all then somewhere around half the total deposit you two contributed might be appropriate.

If the current outstanding mortgage is more than the value of the house (negative equity) then it would seem unlikely you would get anything for walking away.

Ozzuk

Might be worth getting 3 agents out and getting a sale value. Mortgage valuation could be different but at least you'll have an idea if it has increased or fallen in value.