Mortgage options after separation

rewindrooms

Hi all, I'm looking for some advice. My partner and I have separated. We have £160,000 left on our mortgage (18 years overall left). This is split into two:
£60,000 (2.4% interest with 8 years left on the deal) and £100,000 (deal is about to end and will go to 4.5%).

We would like one of us to stay in the home but neither of us is in a position to buy the other out at the moment so we are looking for a way to get through the next year or so at which point one of us will hopefully have raised a chunk to be able to buy the other out. What would out short term options be? We would ideally like to bring the mortgage costs down for this next year so had thought of switching to interest only for a year or extending the term of the mortgage for the next year - but we were unsure of whether these options are likely to be possible and the potential long term impact? As I say, we are looking to do this just for the next year or so in the hope that by the end of it one will buy the other out and  continue to pay the mortgage as normal (this would be a struggle at the minute as one of us is also paying rent on the property we have moved into after moving out of the family home). If by this time next year neither of us is in a position to buy the other out then we would reluctantly sell the house. Thanks in advance! 

smipsy

What plan do either of you have for actually "raising the chunk" to buy the other one out? You both either stay in the house for a year to try and make it work, or the house goes for sale and you both downsize to smaller properties.

If you're banking on "hope" that it will work out, you're setting yourself up for a massive risk. If you are forced into selling next year, you are quite possibly getting less than you would get now, and that's after a full year of rent and other expenses.

rewindrooms

smipsy said:

What plan do either of you have for actually "raising the chunk" to buy the other one out? You both either stay in the house for a year to try and make it work, or the house goes for sale and you both downsize to smaller properties.

If you're banking on "hope" that it will work out, you're setting yourself up for a massive risk. If you are forced into selling next year, you are quite possibly getting less than you would get now, and that's after a full year of rent and other expenses.

Sorry, I should have said - we have money that we will be coming into within the next 12-18 months, we just need to get through this next year.

K_S

@rewindrooms Based on the limited info in your post, it's very unlikely that you'll have any temporary interest only options.

One thing you could look at is extending your term on the current mortgage. Depending on your ages, current term and desired term, with some lenders that can be a option that doesn't require any underwriting.

If it requires underwriting, then you may struggle because of the background rent outgoing.

Another option is a joint borrower sole proprietor mortgage if you have a parent/friend/relative who might be amenable to help you plug the affordability gap.

rewindrooms said:

Hi all, I'm looking for some advice. My partner and I have separated. We have £160,000 left on our mortgage (18 years overall left). This is split into two:
£60,000 (2.4% interest with 8 years left on the deal) and £100,000 (deal is about to end and will go to 4.5%).

We would like one of us to stay in the home but neither of us is in a position to buy the other out at the moment so we are looking for a way to get through the next year or so at which point one of us will hopefully have raised a chunk to be able to buy the other out. What would out short term options be? We would ideally like to bring the mortgage costs down for this next year so had thought of switching to interest only for a year or extending the term of the mortgage for the next year - but we were unsure of whether these options are likely to be possible and the potential long term impact? As I say, we are looking to do this just for the next year or so in the hope that by the end of it one will buy the other out and  continue to pay the mortgage as normal (this would be a struggle at the minute as one of us is also paying rent on the property we have moved into after moving out of the family home). If by this time next year neither of us is in a position to buy the other out then we would reluctantly sell the house. Thanks in advance!