Mortgages and Divorce
Nowadays four out of ten married couples divorce. This is one of the most difficult and stressful situations a couple may face, particularly if they have children. However difficult things may be; one of the most important priorities should be to ensure that mortgage repayments are maintained otherwise this could lead to further financial problems in the future. Most mortgage lenders are quite used to this situation and will be sympathetic as long as they are aware of the situation and they can help couples to sort matters out.
It is a good idea to decide as to what should happen to the property as soon as possible. A married couple usually jointly own a property as a whole so in the event of separation or divorce, they each have the right to claim a share of the home. If one person wants to remain in the house they bought together, they can buy their partner's share. Firstly, a surveyor will need to give a valuation. The buyer would then pay their former partner half the value of the deposit, plus half the increase in the value of the house. The remaining partner will then cover the mortgage on their own. There are various options on offer. Rather than using savings the partner could be paid what they are owed by increasing the mortgage.
If a partner needs a mortgage after divorce or separation, and are relying on maintenance payments, there are specialised mortgages which treat maintenance payments as normal income. Today the mortgage market is recognising the difficulties faced by people - especially women - following a divorce and is starting to respond. An increasing number of mortgage lenders are now willing to take into account maintenance payments, not only by court order but also by private agreement. Nowadays, working and child tax credits and secondary incomes can also be considered when calculating affordability for a mortgage. Building societies and banks are even starting to launch schemes aimed specifically at divorcing couples.
Our mortgage advisers are experienced in finding the right mortgage for people in this situation. If you would like us to help you to find the best deal available for you or for help and advice, please click on our Mortgage Enquiry Form below and one of our experts will contact you. Alternatively, you can give us a call on 0845 108 0505.
