Joint mortgages separation

What happens to a joint mortgage after a separation?

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Here's what can happen to a joint mortgage after a separation.

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If you’re going through a divorce, it’s understandable that you might be concerned about your home – especially if both you and your ex-partner still have a joint mortgage together.

You do have a few choices when it comes to dealing with a joint mortgage after separating, so you can try to resolve the issue as simply and as amicably as possible.

What are the options for a joint mortgage during a separation?

If the divorce looks to be certain, you have a few options to choose from when considering your joint mortgage:

  • Sell the home: one of the simpler ways to resolve the issue is to sell the home, pay off whatever remains of the mortgage and split the rest of the money. For homes in negative equity, you may have to divide any outstanding debt between you - though you should talk to your lender to find out what your options are.
  • Buy out your ex-partner: you may decide that one of you will buy the other out of the mortgage. If you need to borrow money to do this, you will have to prove to your lender that you can afford the mortgage repayments on your own.
  • Retain a stake in the property: another option is to transfer a part of the home’s value, so one partner would own most of the property, but the other would retain a stake in the home. This means they’ll be entitled to a percentage of the value if the home is sold.
  • Pay off the mortgage: your mortgage may be close to completion, and if the divorce is friendly, then you might even agree to both continue paying until it’s completely paid off. This way you’ll be able to sell the home and split the entire proceeds afterwards.
  • Find a guarantor: if one person wants to take over the whole mortgage but can’t afford the payments on their own, they can apply for a guarantor mortgage. This is where someone like a family member agrees to cover the repayment costs if you’re unable to.

Mesher and Martin orders

You’ll also have the choice of taking out a Mesher or Martin order if you live in England or Wales:

  • Mesher order: a Mesher order is a family court order that prevents the home being sold for a set period of time, usually because the couple separating still have children living in the home. Mesher orders mean one person is allowed to stay in the property with the children until a certain point - normally when the youngest child turns 18 or finishes secondary education, though sometimes it could even be higher education. The property stays in both parties’ names for this time, even if only one person is currently living in the property.
  • Martin order: a Martin order is similar to a Mesher order, but children aren’t usually involved. One person might decide to remarry or begin living with a new partner, but a Mesher order would mean that one of the separating couple is allowed to live in the property for the rest of their life - and the home can only be sold when they die or choose to move.

Paying the mortgage after separation

One key thing to remember is to continue paying the mortgage after the separation. A joint mortgage means you’re both liable for debt, and this is until the mortgage has been completely paid off - regardless of whether you still live in the property.

This means it’s important to keep making your repayments while you decide what to do because falling behind can damage the credit reports of you and your partner – which will still be connected and influencing the other person’s credit report as long as both your names are on the mortgage.

Some providers might be able to help while you settle your affairs, but this isn’t always confirmed, so it’s best to check with your lender as soon as you can.

Matrimonial rights

In the UK, cohabiting under marriage means the home is legally considered a joint asset, even if only one person’s name is on the deed – this means no one can be forced to leave the home.

If the mortgage or property is only in one person’s name, the other can go through the land registry for a Notice of Home Rights to confirm their matrimonial rights and prevent the property being sold without their say – though this is normally only until a divorce settlement has been agreed upon.

If the property was owned by the person before the marriage, the other’s claim is likely to be much weaker – unless you had a pre-nuptial agreement in place that already decided how you’d divide your assets if you separated. In either case, it might be worth seeking legal advice to get a better idea of where both of you stand.

Divorce court

Divorces don’t always go smoothly, and you might find that you have to go to court to settle a dispute about your mortgage and property. If your divorce looks to be going this way, you’ll likely need to seek out legal advice - which can be costly and time-consuming.

The court will take a number of things into account before making a decision about your home, but if children are involved then they will usually become the main concern.

Speak to your lender

Going through a divorce can have an impact on your finances, so if you think you might struggle to make your mortgage payments, it’s a good idea to contact your mortgage lender. They might agree to give you a payment holiday – a temporary break from having to make mortgage repayments – depending on the terms and conditions of your agreement.

It’s important to apply for a payment holiday first before stopping any payments, because doing this without letting your provider know first will be seen as a missed payment – which can affect your credit rating.

You may have to make larger mortgage payments than usual to be able to take a payment holiday. This could either be before the mortgage payment holiday, which would mean you’d have to increase your payments before being able to take a break, or the larger repayments could come after the holiday as a way of recouping the missed payments.

Next steps

Mortgages can become complicated during a divorce, but there are places where you can find help and advice to make the process go as smoothly as possible.

You may want to talk to a financial or legal advisor so you know exactly where you stand and what your rights are, but it’s important to remember that these services can be expensive. You can also go to the Citizen’s Advice Bureau for free impartial advice about your options.

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