Mortgage Reversion??

geoffw6

We have a house valued at approx 350k with 70k approx mortgage outstanding. 

I am 72 and my wife is 52 both of us are in full time employment. My wife and I have split up recently and the house is in my wife's name, we've agreed that I should stay in the house for now...she has moved to a flat. We bought the house in 2019 and have completely renovated the property and extended it. 

I am currently paying the mortgage and all bills on this house and paying half her rental costs. She has indicated that although she has now signed a new rental agreement on her flat taking her to Feb 2026 she would like me to "buy her out" as she would like to get her share of the property to allow her to purchase a small house next year. 

I love this house and want to stay, She is looking for approx 130k. I don't have much savings I've looked at seeing if I can get a private investor who wants to finance the above but allow me stay in the house under a legal agreement, reversion mortgages, lifetime mortgage. Any sensible advice taken into account all the above is very welcome. Thanks. 

Linton

At 72 equity release may be worth considering. You should be able to get about 1/3 of the house value which is close to what you need to buy out your wife.

With ER the interest is normally added to the mortgage debt and everything is repaid when the house is sold at death or if you go into  permanent care. The down side is that it will significantly reduce the money available for your beneficiaries, but that may not worry you.

There is also the option of a Retirement Interest Only (RIO) whereby you pay the interest but the capital value of the loan, like ER, is repaid when the house is finally sold. In this case you would need to satisfy the lender that you can afford the nterest.

MWT

Linton said:

At 72 equity release may be worth considering. You should be able to get about 1/3 of the house value which is close to what you need to buy out your wife.

Unfortunately the current mortgage balance of £70k would also have to be cleared as you can't have another mortgage as well as the equity release.

Having the house in the wife's name adds some complexity but nothing insurmountable if the numbers can be made to work.

RIO and equity release are worth talking to a broker about, but the RIO is only going to work if there is sufficient income once the employment ends.

I suspect it is going to be challenging to come up with around £200k to clear the mortgage and cover the buy-out.