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Hi All,
Looks like the marriage is a gonna.
Am trying to get my head around housing options
Need 2x places. A larger one for her, close to the kids' school plus a smaller one for me.
She wants to borrow against our current place to buy / create a deposit for the latter.
There's some equity in the current house, plus it's gone up in value a lot.
Valued at 500k,bought for 385, works out potentially 200k of equity.... If we sold it..
Any one got any experience of this?
I'm sceptical. I was thinking sell the place and use the cash make purchase of new places. Perhaps one as a shared ownership.
Thoughts?
If you borrow against the current house it'll make it more complicated to sell. If you've no intention of keeping it then yes, work out what's happening with all the money and sell it and split the equity according the the financial agreement.
Why borrow against a place you're going to sell and incur fees and interest and make it more complicated to shift?
Don't do anything until you've both had legal advice. Work really hard to stay on good terms but It's never ever as easy as it looks. Good luck.
Legal advice!
Selling then dividing the debt/equity as agreed.
Borrowing against the current place to fund new places? That sounds unwise.
That sounds unwise. Do get legal advice as previously suggested in this thread. Best of luck.
I have very recent experience of this so first of all, let me offer sincere condolences for the loss, because that is what it is.
The first thing to highlight is that the route you chose to settle the divorce is key. Have a look at something called 'the collaborative process'. It's a new initiative launched and regulated by the law society that seeks to remove the adversarial approach to divorce proceedings that is the inevitable result of having confidential positional advice.
In the collaborative approach, all your meetings with your lawyer are done in plenary and everything that is said, is said openly between all parties. This makes a ton of difference. Also keep in mind that you cannot get a divorce without a financial settlement agreed and the court will not grant the divorce if they feel that one or both parties has not got a fair deal based on impartial advice. If you’re just going for 50/50, which is what the law says for marriages over say 10 years, then you stand more chance of getting the court to agree without having to involve a lawyer, but even then, that's a really bad approach to it; you have no idea what your best interests are at this point!
On the point of the housing, why would you need a smaller house; are you not planning on having the kids at least some if not half the time? If the plan is for one of you to take the responsibility for child care more than the other then the court will want to see that that party has enough equity to buy a suitable family home.
I cannot imagine your partner would be allowed to borrow against a shared asset; doing so would mean that they are ostensibly taking out a second mortgage, which would then make one of the two properties a rental. I can’t imagine a lender would allow that for just one party without the consent of the other and if the marriage is over, why on earth would you consent? Seems very messy to do it that way.
The best outcome is that you sell the house and use the equity to buy two properties, with the asset split being whatever you agree, but ostensibly being 50/50 in law as a starting point and then the needs of reach party are considered beyond that.
Life may feel like it’s about to get tough and how tough will of course depend on how old you are (I was 47 when I applied for my mortgage following separation) as age will determine how much longer you’ve got to pay off the mortgage, how long the mortgage will last and thus how much you can borrow.
My last piece of advice would be to do everything you possibly can to keep it amicable and never give up on that; no matter how bad it gets, just keep trying to be the best ex your partner could have hoped for.