What happens to a joint mortgage when you separate?
- Whether you live in the property or not, your mortgage terms bind you, and you are jointly liable to pay the mortgage even if you separate.
- If one of you stops paying their share of the mortgage, and you don't pay your full mortgage repayment, then it will show as a missed mortgage payment on both your credit files and could mean you'll struggle to get a mortgage in the future.
- Where you cover the mortgage repayments of your ex-partner's, you could ask for this to be repaid as part of the settlement from the sale of the house.
- Inform your mortgage lender immediately of the separation and request they do not allow further advances.
- You both have a legal right to side in your property unless you have an Occupation or Non-Molestation Order.
- Not all separations must be expensive and long-winded legal battles and could be settled using mediation.
When separating from your partner, the mortgage payment obligations are often confusing. If they move out, do they still have to pay the mortgage?
The fact is that no matter what the relationship is between you, your relationship with the mortgage lender remains the same until you pay off the mortgage. This means you're jointly liable to pay the mortgage to the lender every month. Sadly, what can happen is a breakdown in the relationship, and one person stops paying. This article explains everything you need to know when this happens.
What does the mortgage lender state in their mortgage terms?
You are bound by the terms and conditions of your mortgage until you repay it. Here is an example of what your terms may be:
- The Mortgage Documents apply to all of you together and each of you on your own;
- Each of you will be fully responsible for meeting the obligations under the mortgage documents; and
- We will be entitled to accept the signature, instruction or authority of any of you (borrowers on the mortgage deed) as being given for and on behalf of all of you, unless you have told us otherwise. This may mean that we agree to change the type of interest rate you have on the application from one of you. We will, however, always require all of you to apply where the application is for us to make a further advance.
Source: Barclays Residential Mortgage Conditions 2018 edition
The wording for different mortgage lenders may differ slightly, but the context is clear that regardless of your relationship, beneficial interest or if you live in the property, you are both jointly and severally liable to pay the mortgage.
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- What are you due on sale?
- How to sell where one person doesn't want to.
- Mediation and Settlement Agreements.
- Applications to court, including Declaratory Orders, Regulatory Orders, Occupational Rent.
How do you avoid a joint mortgage paid by one person?
You can avoid a joint mortgage with one person not paying through a number of the following routes:
- 1
Buy your ex-partner out
To avoid living in the property and sharing the joint mortgage, you can buy the other out. The process is:
- Agree the equity split. Often, it is not an exact science unless you have a Deed of Trust stating what you should be paid. Where there is no deed, you can take a fair and reasonable approach of splitting the gain 50:50 or calculating a more precise amount. If you choose the latter option, you may have a lengthy legal battle to get the extra money from the property, and you should take up our offer of a free consultation* above to find out if it is worth it. Read more - How to calculate buying someone out of a house
- Update your mortgage. You can either obtain consent from your mortgage lender to remove the name from the mortgage, or you can apply for a new mortgage. You'll need to follow the mortgage application route through affordability, and there is no guarantee you'll be able to afford the mortgage in your sole name. If this is the case, you could ask a family member to support you on your mortgage application using a Joint Mortgage Sole Proprietor mortgage product.
- Transfer of Equity Conveyancing. The transfer documents and mortgage can be updated at the Land Registry. Read more - What is the transfer of equity process?
- 2
Sell the property
If you can't afford to buy the other party out, the only option is to sell the property. Delaying this decision could mean your partner stops paying toward the mortgage and cause you financial hardship as you pay the full mortgage. The process is:
- Agree the equity split. As mentioned above, you must agree on a fair and reasonable split.
- Instruct selling agents. Find a local estate agent to sell the property for you. Where you have a joint mortgage and separate, it is better to have an actual selling estate agent versus an online one so they can handle the process for you and reduce the amount you need to contact each other.
- Sale Conveyancing. Once you find a buyer, you can complete the sale and find new accommodation: renting, moving in with your parents or an onward purchase.
How do I leave my partner on a joint mortgage?
It is not uncommon for a couple to argue over who keeps the property or if it should be sold. The best advice is to take a balanced and reasonable approach because unless one of you can afford to keep it on your own, the property will need to be sold as the relationship isn't ongoing.
There are complexities when looking to force the sale of a property. Was it bought as a family home, or are there children or dependents living in the property? The process of forcing a sale is long and can be costly in legal fees with solicitor, counsel and court fees - Plus, you're not always guaranteed to get the desired result. Read more - Can a jointly owned property be sold by one owner?
What happens if you stop paying the mortgage?
If you stop paying your mortgage repayments, your mortgage lender could repossess your home. The other implication is that your credit score could negatively affect any future mortgage application, mobile phone contract or loan approval. Read more - What happens when you get repossessed?.
How do you share mortgage repayments after you break up?
How you split the monthly mortgage repayments is of no concern to your mortgage lender because, from their perspective, you must jointly pay the full amount. However, between a couple, you may agree to share the mortgage repayments in any share you like.
All too often, one person leaves and expects the other person to pay for the mortgage and other household costs. But, if they can't afford to pay, the property could be repossessed, and your individual credit ratings will be negatively affected.
These are some ideas on how to share mortgage repayments when you split with your partner:
- Jointly live in the property and equally share mortgage repayments.
- One owner leaves the property, a tenant moves in and pays rent for their room (subject to mortgage lender consent). The owners equally share the mortgage repayments.
- One owner moves into rented accommodation/parents' home, and the remaining owner pays the full mortgage repayments.
What if I've been paying half the mortgage and I'm not on the mortgage?
If you are splitting with a partner and have been paying the mortgage but aren't registered as an owner, then you should read this - Splitting up with partner? Are you owed money from the sale of your house?
What happens if one person has been paying more of the mortgage repayments?
Where one party pays more than the other towards the mortgage repayments, they may have a case for receiving more property income on sale as they have created a constructive trust. This means that whilst your name isn't registered at the Land Registry as a legal owner, the registered person holds the property on trust for you and themselves. Read more - What is a constructive trust?
If you have been paying more of the mortgage repayments, then call us to ensure you receive the correct share of any gain from the property when you sell - call 0333 344 3234.
How do I remove someone from my mortgage without refinancing?
To remove someone's name from the mortgage you need:
- Your ex-partner to agree. The hardest part is agreeing to an equity payout because you can't remove your ex-partner from the mortgage without them agreeing; and
- Your lender's consent. You can remove someone from your mortgage without refinancing with the mortgage lender's consent. The lender assesses you for affordability and checks your current credit score, so make sure you never miss a mortgage repayment.
Caragh is an excellent writer and copy editor of books, news articles and editorials. She has written extensively for SAM for a variety of conveyancing, survey, property law and mortgage-related articles.
