Divorce, when you own a house, can seem a little complicated, but it doesn’t need to be. There are a few reasons why you may want to still own a house with your ex when you separate. The three most common reasons are:
- You have kids and want to keep the family home but one person can’t take over the mortgage in their sole name, so they need their ex to remain on the mortgage agreement
- You don’t want to sell the property yet and would rather keep the property/properties as an asset
- You are earning rental income from the property/properties
Whatever your reason for wanting to remain the owner of your property/properties together, the important thing to know is that it is possible. However, you need to be aware of the following things when it comes to divorce and house ownership.
1. If you jointly own the property as ‘Joint Tenants’ you will need to swap to ‘Tenants in Common’ and confirm this with your mortgage provider
What’s the difference between ‘Joint Tenants’ and ‘Tenants in Common’?
Two or more people share equal ownership of the property. The property automatically goes to the other owner(s) if you die regardless of what you may have put in your will.
Tenants in common:
Two or more people have ownership interests in a property. Each owner has the right to leave his/her share of the property to any beneficiary upon their death. You do not need to hold the property in equal shares.
2. If you agree to continue to own property/properties with your ex, you should obtain a legally binding consent order.
The order should set out who owns what percentage of the property, who is paying for what in terms of the mortgage and other outgoings and what are the trigger events for the property to be sold.
3. Tax implications
If you continue to own property/properties with your former spouse there may be tax implications for you particularly if you go on to purchase another property whilst you continue to co-own with your ex. It is advisable to seek specialist tax advice.
For more help, get in touch with one of our amicable experts by booking a free 15-minute call here.
How to buy your ex out of the house?
Start by discussing this with them. You will need to work out if you have the resources to do so. If the property is subject to a joint mortgage, this will include finding out from your lender whether you are able to re-mortgage in your sole name and pay your ex their share of the equity.
If you are divorcing or ending your civil partnership, you should consider legalising the financial arrangements you’ve made by getting a legally binding consent order. Getting a consent order isn’t mandatory but it is recommended to ensure you have formalised your financial separation through the courts.
What happens when you divorce, and you own a home together?
When you divorce, you will need to sort out three things legalise the divorce, agree your financial arrangements and if applicable, childcare arrangements. You will need to decide what you are going to do with any properties that you own (it doesn’t matter who’s name they are in).
Is my spouse entitled to my house if we divorce?
This will depend on multiple factors, however, divorcing does not end the financial relationship and you will therefore need to formalise any financial arrangements you have reached. You can do this by getting a consent order or financial order.