We understand that going through a divorce or separation with your partner when you have a joint mortgage together can be difficult. This guide provides you with a list of frequently asked questions that you may want to know when it comes to divorce and separation.
Do I need to keep paying my half of the mortgage?
In any case, you still need to keep paying your half of the mortgage even if you are living elsewhere in the meantime.
Regardless if only one of you is living there at the moment, you are both held equally liable for the debt as you and your ex-partner both agreed to take out a joint mortgage. Therefore, you need to keep paying half of your mortgage until it gets paid off.
If you fail to pay your mortgage on time, it can harm both you and your ex-partner’s credit history. Failed mortgage payment could lead to repossession of the house if you do not keep up with repayments on your mortgage or any other debt secured on it.
When should I inform my lender?
It’s best to inform your lender sooner rather than later. We recommend you mention this to your lender when you know you are separating.
What are my options?
1. Sell The Property
If you have both agreed it is best to move out, sell up and pay off the mortgage, any equity left after the mortgage has been paid off will be split between you and your partner. In terms of who gets what in the leftover funds is a matter between yourselves.
Our trusted mortgage advisors in Cardiff are here if you decide to move out and look to purchase a new property. They can recommend you with the best deal, offering honest mortgage advice.
2. Continue to Make Those Payments
In some cases, where the divorce is on good terms, you can decide to stay and pay the existing mortgage. This option can be beneficial if your mortgage is fixed for a couple of years.
3. Stay in The Property
In the situation in which you or your ex-partner will live in the property, then the remortgaging of the property would be under the current resident in their sole name.
You will need to remortgage in Cardiff if you decide to become the sole owner of the property because there is an existing mortgage in joint names. From this, you will then need to take out a new mortgage in your sole name, meaning your affordability will be reassessed.
Can I get a second mortgage?
Depending on your circumstance, yes you can get a second mortgage. When applying for a second mortgage, each lender will have different credit scoring systems they use and consider a range of factors.
One main factor to look at when applying for a second mortgage is your current financial commitments. From this, you can determine if you can afford the second mortgage as there could be a risk of your application getting declined which could negatively affect your credit file.
The good news is that, here at Cardiffmoneyman, we can perform a search for you that won’t damage your credit file. The maximum amount you will borrow will be confirmed when we have the necessary information gathered.
From this, you can have a good idea of your budget and how much your monthly mortgage will be on top of your current financial commitments.
Moving away from your current financial commitments can be a challenge, however, this is why having an expert mortgage advisor in Cardiff by your side could be beneficial.
An experience like moving home in Cardiff can be stressful, especially when a complex situation like divorce or separation is added to the mix. Our caring and knowledgeable mortgage advisors in Cardiff will do their best to help you with this process.
What if I am in negative equity?
Negative equity can happen when the value of your property falls. In the situation where your joint home is in negative equity and you are divorced, it can become a challenge to sell the house and pay off the mortgage in full.
The outstanding debt might have to be split between the two of you or follow and agree with your mortgage provider’s advice.
Date Last Edited: October 9, 2024
