Buying out my ex partner from joint mortgage

caslad81

Hi all,
Unfortunately me and my partner have decided to split but remain amicable.
Im really in need of some advice as I would like to keep the house, but after spending hours online Im confused at how to do it and if I can afford it. Ill give you a brief synopsis of the financial situation.
The house is worth £250,000 with 12 years left on the mortgage and £74,000 left to repay, leaving us with £88,000 each equity in it but would need to consolidate our current debts of around £10,000. We are currently on a fixed rate of 3.9% which is due to end in 2028. I am 41 years old earning £31,000 per annum with very little outgoings.
My question is, if you were in this position, what would be your course of action? Ive got an appointment with my bank in 3 weeks but I need to get my affairs in to some sort of shape my end before I go to see them. Any insight, advice or tips would be greatly appreciated.

Thanks

Brie

So what you're talking about is getting a mortgage, on your own, for £162k.  Because obviously you'll need to pay £88k to your soon to be ex partner plus look after the current mortgage.  But because there will be costs involved chances are you'll need something upwards of £175k at a guess.  So a mortgage = to about 6 times your income.  And at a higher interest rate than you currently have.   

It may be possible but to prep yourself for the conversation I would suggest putting together a comprehensive budget ready to present to the bank person to show how much you'll be able to afford to pay each month after all the bills. 

Because while you say you have very little expenditures there's going to be all the gas, electricity, water, sewage, council tax and food at an absolute minimum.  Add things like phone, broadband and then the costs associated with working, car, petrol, MOT, clothing, haircuts etc.  A great place to start with this is to go to the debt free forum and look for the statement of accounts as that will show you everything you need to include.

You also say you want to consolidate about £10k of debts.  Whose debts are they?  Are they actually "ours" or are they yours or your partner's?  Of course it may be that you have a credit card and your partner uses it but you have agreed that you will split the bill 50/50.  I suggest you both apply for a different card now which you each use just for your own stuff and tell the CC company for any joint cards to be shut down pending paying them off.

caslad81

Thanks for the advice, just to clarify the debts are a loan for home improvements in joint names.

Brie

OK - so you might want to look at clearing that before doing the house buy out just to keep things tidier.  Otherwise an appropriate portion it would need to be included in calculating what you are paying to the ex.  Frankly the person at the bank has probably dealt with similar so may very well be able to advise what's going work best.

prowla

I don't think one person can take over an existing one, so it'll probably need to be a new mortgage.

That would the be subject to affodability on the one income, which could be marginal for a mortgage of £170k on a £31k income.

Titus_Wadd

Please consider all options.  I know my experience is dated, I bought out my ex in the 90s.  With the benefit of hindsight we should have sold up and I should have bought a smaller place for myself.  I thought staying in the house with most of the furniture etc would be less upheaval but I maxed the multiples of my salary- 2.5 x £27k and had to go through a broker as few banks were keen to lend more than 2 times back then.  Then interest rates went above 15% and I was struggling.
" That's a great story grandma  "
Just do your homework and draw up a brutally frank budget, as already suggested.