Equity freeze - advice appreciated 31 December 2022 at 12:53PM in Mortgages & endowments 2 replies 252 views

frankbutcher1734

Hi, any advice here much appreciated.

My wife and I have separated, house is on the market at 600k, our mortgage is ~280k.
I want my kids to have stability of staying in their home but I certainly can’t afford to buy my wife out, she can’t buy me out but could take on the mortgage with her current salary. 

I’ve come up with an idea of freezing my 50%of the equity and moving out to rent for a couple of years (my kids are 16 and 14) and my wife takes on the house, mortgage and bills. I couldn’t afford to contribute so that’s why I say freeze my share of the equity. Sell the house when at least one of my kids goes to Uni or whatever…
would I be doing myself an injustice financially? Is this a daft idea? I just need to run it by someone and this seemed as good a place as any!
Thank you. 

silvercar

First question is whether your wife can afford to take on the house mortgage and bills and would she want to. Reading some other posts on here (marriage board is a good place to look) she may begrudge you getting a fixed portion of the equity if she has been paying the mortgage alone for a number of years.

Your idea commits you to renting if your savings are tied up in equity in this property, are you happy not to be able to buy in the short term?

Annisele

Do you have any other assets? If so, trying to deal with the house in isolation might complicate things unnecessarily.

I'm thinking in particular of pensions - if (for example) your pension is much larger than hers, you might end up deciding that she keeps the whole of the house equity in exchange for you keeping your pension.