It’s unfortunate when you’re in a situation where you and your partner decide to part ways which means you need specialist advice. Getting specialist advice is important because you have joint financial commitments, and unwinding that side of things isn’t very straightforward.
Below are the top three questions we get asked on Divorce and Mortgage Advice regularly:
Getting a mortgage is a big financial commitment and making changes to your mortgage in the future isn’t always easy. Because of this, a lot of people aim to buy a house with their partner as a means of splitting the financial burden between two parties.
In circumstances that involve children, the partner who spends more time raising the children like a ‘stay at home’ parent will often stay in the property. It may be the case that the individual occupying the original home would prefer to take over the mortgage in their own right. This is not always easy!
You may be able to pay the mortgage and have the ability to demonstrate that you can independently. It does not, however, change the fact that you bought the property jointly. In other words, in the event of mortgage arrears, there are 2 people the lender is allowed to pursue.
The remaining applicant needs evidence that they can afford the mortgage before removing a party from a mortgage. This will give confidence that the remaining applicant can keep up the mortgage in the future. As well as this, the lender will need to assess your income even if you have kept up your mortgage payments in the past.
It’s common in these situations that someone will step in to replace the ex-partner like the family member or potentially your new partner.
When it comes to assessing the applicant’s affordability of the mortgage, many lenders have slightly different ways of doing this. Therefore, don’t lose heart if your current lender declines, we still may be able to help you.
Firstly, you need to understand that you are still responsible for any joint financial commitments you took out with your ex-partner, even if you are not a current occupant in the family home.
This rule is still in place even if you have come to an agreement with your ex that they will make all the payments.
If you are looking to buy a new property in the future, the mortgage payment for your old property will still be taken into consideration. Due to this, it’s important that you take mortgage advice before making an offer.
When it comes to how much you could be given by the lender, some are more generous than others. We will, however, take this into consideration when recommending the most suitable lender to apply for a mortgage agreement in principle with.
You can have 2 mortgages. Before lenders offer you a mortgage, they would use their own credit scoring systems and take many factors into account and ongoing financial commitments is just one of these.
As well as any other loans and credit commitments you may have, the monthly payments of the mortgage you will hold with your ex will need to be inputted.
After we have sorted all this for you, the maximum amount you are able to borrow will be confirmed to you by the various lenders’ systems. This will allow you to know your budget at the beginning and how much deposit you will need to put down.
Despite it being difficult to move on from your previous joint financial commitments, it’s good to remember that it’s all about risk from the lender’s point of view and their main intention for doing this is to avoid repossessions situations at all costs.