Your options when separating with a joint mortgage
When you separate and share a joint mortgage, there are usually three routes. One of you buys the other out and takes the mortgage on alone. You sell up, clear the mortgage, and divide whatever equity is left. Or you carry on owning the property together under a new arrangement, which is less common but can make sense when children are involved.
Which route is right comes down to a few things: whether either of you can afford the mortgage alone, how much equity sits in the property, whether you are married (which changes your legal rights), and whether children are living in the home.
Buying out your partner
If one of you wants to keep the property, that person takes over the mortgage and buys out the other’s share of the equity. This is done through a transfer of equity, where the leaving partner’s name comes off both the mortgage and the property title.
The partner staying put has to afford the mortgage on their own income, and the lender runs a fresh affordability assessment as though it were a brand new application. If they cannot qualify alone, there are still options: remortgaging to a cheaper product, stretching the term to bring the monthly payments down, or adding a different joint borrower. A guarantor mortgage can also help where a family member is happy to back the application.
Selling the property
Where neither of you can carry the mortgage alone, selling is often the tidiest answer. The money from the sale clears the mortgage, and any equity left over is shared out between you. For married couples, divorce proceedings decide the split. For unmarried couples, it comes down to the ownership structure and any deed of trust you put in place.
A sale takes time, and you are both on the hook for the payments right up until it completes. Agree early on how you will split those payments in the meantime, so you avoid arrears that would dent both of your credit scores.
Can you just remove someone from the mortgage?
No, you cannot just ask the lender to strike a name off a joint mortgage. They agreed to lend on the strength of both incomes, so taking one borrower away changes the risk they signed up to. The remaining borrower has to apply to take the mortgage on solely, and that means passing affordability checks on their income alone.
If they cannot pass those checks with the current lender, remortgaging to a different one that will accept the sole application may be the way forward. A broker can pinpoint the lenders most likely to say yes to a sole application, based on your income and circumstances.
Get help from Clearview during a separation
Dealing with a joint mortgage in the middle of a separation is hard, both emotionally and financially. At Clearview Mortgage Solutions, we give you calm, practical advice so you can see your options clearly and take the next step.
Whether you need to arrange a transfer of equity, remortgage to release a partner, or just work out what you can afford on your own, we can help. Contact us for a free, confidential chat.