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Remortgage Advice - What divorce may mean for your mortgage

Splitting up with your partner can be a stressful ordeal, your mortgage situation may not be the first issue that springs to mind but, who gets the house certainly will be right up there with important considerations.

When you take out a mortgage with someone else you are considered "jointly & severally responsible" for the mortgage payments. This means if one person stops paying or disappears then the other is 100% responsible for the payments. Missed payments will be recorded & affect both peoples credit rating &, as such their ability to apply for a new mortgage.

Even in the best of situations, seeking remortgage advice can be a good move. While having to remortgage because of a divorce might not quite slip into this category, it can be a very wise move in the event of a divorce. But where should you start? Read on to find out.

Should I keep paying my mortgage ?

Absolutely! While it may seem like a pain, regardless of whether you’re in a joint-tenancy or you’re paying for the mortgage outright, you’ll need to keep on paying for your mortgage. Remember, if you don’t pay your mortgage repayments on time then it could have serious negative repercussions on your credit score. As a result, your ability to get a more desirable mortgage deal once you’ve moved out of your home could seriously be harmed.

The other downside of not paying for your mortgage is that if you fail to pay your share of the repayments then this may mean that you lose your home. Moreover it can mean that should your divorce settlement ever go to court it would compliment your partner’s argument very well. So, our advice is to absolutely make sure you keep on paying!

Contact your lender:

Once you have confirmation that your divorce is going to be going ahead make sure that you speak to your lender. This is going to be vitally important. This is mainly because that divorce can have quite a big impact on your finances and your ability to make monthly mortgage repayments. Also, if you were to remortgage, this can have an impact on the amount that you could borrow. 

See what your options could be:

It could be that you decide to get a new mortgage in your own name. Moving a joint mortgage into just one name can save you the hassle of having to remortgage, but this could be easier said than done. The ability to afford the mortgage payments was based on two people applying. If your new situation means that the household income has drastically reduced then it may be deemed that the mortgage is no longer affordable. best thing to do is seek remortgage advice. Ultimately if you’re moving away from a joint tenancy contract you’re going to need to show that you can afford the additional borrowing. Where remortgaging saves money, for those coming out of a divorce, you will need to prove that you can afford the mortgage on your own. We recommend that before you negotiate this that you evaluate the level of equity that you and your partner have in the property each.

If you are the one moving out of the family home & looking to purchase a new home then, if you are still named on the previous mortgage you will be accessed as if you would be paying for both mortgages, which legally is the position you could find yourself in.

Sometimes it's simply a case that the family home has to be sold, equity split as directed then........start again.

Ultimately, if you feel like you have any more questions that need answering then check out some of the other articles on our website. At Mortgages Online we can offer you fantastic advice on whatever property predicament you find yourself in. What’s even better is that we’re free, impartial and available for you at all times. So, get in touch! Speak to a mortgage adviser to discuss your remortgaging options.

 

At Mortgages Online, we have tonnes of articles with information on interest rate rises, life insurance, standard variable rate mortgages and more – all of this for, as we said, for free! No credit card required. Visit our Articles section to find out everything you could ever need to know about mortgages.

For more remortgage tips, visit our Remortgage articles section or to look into remortgaging, visit our Remortgage page to see what MO can do for you!

LauraWaller

Laura Waller

Laura Waller has been working in the mortgages industry since 2013, joining an independent brokerage in Essex. Laura has CeMAP 2 & 3 – Certificates in Mortgages Advice and Practice. Since then Laura oversees marketing for Mortgages Online, using her experience and expertise to write articles and blogs about mortgages and related topics.

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