One of the common issues affecting house owner status is a sudden change in your personal circumstances, such as divorce or separation. If you’re unsure of what will happen to your property and mortgage if you’re getting divorced, read on to discover the facts.
It’s never nice for a relationship to end and for couples to split up, but where property is added into the equation, it can seem even more of a nightmare. What will happen to the property if you have a joint mortgage, and who will end up with the house?
Questions such as these are likely to be rife in your minds, but there are several options available. In the first instance, always notify your mortgage lender that you have an impending change in your circumstances.
This is especially important if you’ve taken out a joint mortgage as the failure to pay the usual mortgage fees on time can have an impact on both your credit histories, not just the person that doesn’t contribute their payment. This is because you’re both liable for the debt on the mortgage, regardless of whether you’re both still living at the property.
It’s reassuring to know that some financial lenders can be sympathetic to couples going through the divorce process and might be willing to provide a temporary payment holiday to help reduce financial worries. This doesn’t mean the original mortgage agreement will be severed, far from it – but it does give you a short break from your monthly payments and can help you get a hold of your new relationship circumstances before reconvening with your usual monthly payments.
When it comes to what you decide to do with your mortgage and property, there are several possibilities. These are all made easier if you can decide between the two of you what to do, as it can help you avoid having to face lengthy court hearings.
If you don’t have long left on your original mortgage agreement, then you could both continue to pay it until it ends, then sell the property and divide the proceeds of the sale. You could both live in the property whilst you pay off the mortgage, or rent elsewhere.
If that’s not an option for you, and you want to move on quickly with things, you could both opt to move out and sell the property. If you go down this route, then you will need to pay off the remainder of your mortgage with the proceeds of the sale.
Alternatively, if it’s financially possible, your joint mortgage could be transferred over to one of you. So one partner will buy the other’s share of the house, including their share of any equity. This is of course only possible if the person taking on the full mortgage debt can prove that they have the financial ability to afford paying for the mortgage on their own.
In terms of your future status as a house owner, it all depends on finances and how the divorce and potential sale of your property has impacted on your financial status. Some people find it can be a considerable drain on their finances going through a divorce, whereas others relish the chance to start afresh and buy a new home.
Whatever your individual experience of divorce, as long as you have no outstanding debts, are earning a wage and have money available, there’s no reason why you can’t progress to buying property again in the future.
For more information about dealing with property and mortgage issues, seek advice from a solicitor. If you need help with freeing up your finances and gaining a quick sale on your London property, contact Molae Properties today.
