A standard joke in the Property business is “where would we be without the 3 D’s?
Except it’s no joke.
The Buying and Selling of houses is driven in a good part by the Deaths of property owners, by Debt reduction (downsizing) and by Divorce.
So what happens to the house in a divorce? Sadly this is the question thousands of people need help answering every year as an increasing number of couples are obliged to divide their biggest asset — their home. Unfortunately this process can be complex and has the potential to make a bad situation even worse.
If you’re about to start a divorce or legal separation proceedings both parties need to know where they stand. The first thing they should do is consult with a solicitor for advice. Things can get really complicated if one partner on the mortgage agreement does not intend to contribute to the mortgage repayments in the future. There are also legal obstacles to negotiate if the plan is to split payments. It doesn’t really matter who pays the mortgage in terms of liability. If repayments are late anyone whose name is on the mortgage agreement is liable.
The moment couples decide to break up they should quickly contact their mortgage provider to tell them what’s happening, particularly if one party has reason to believe that the other won’t meet their repayment obligations. There is always a chance that the mortgage provider can help with a repayment holiday or in other ways to reduce the monthly commitments. It is also important to prevent any partner from re- mortgaging or releasing equity from the home without agreement.
What are your legal rights when selling a home because of divorce?
You are a legal owner of your home if your name appears on the title deeds. Don’t worry too much if your name has not made it onto the house deeds as you can “register your interest” in the property with help from a solicitor.
The first thing to do is check with the Land Registry for England and Wales and see if you are, in fact, a named owner on the title deed. If you’re not, you or your solicitor can issue a “matrimonial home rights notice”. This is done by completing an HR1 form, which can be found on the GOV.UK website. Doing this will ensure that your stake in the home you shared with to your former partner is protected.
How will my house be divided during my divorce?
There are many possible outcomes when it comes to dividing the value of a home during a divorce. Whilst many couples come to a mutually acceptable agreement without too much involvement from solicitors, one of the following could happen if things take a more formal route:
> The property will be sold as quickly as possible and the proceeds divided fairly
> One person can formally buy the other out
> One person can become the sole owner with a legal change of ownership
> The house can be transferred to one partner as part of a wider financial settlement
If you’re in England and Wales and you’re not ready to sell the home you shared with your former partner, you can apply for a “Mesher Order”. This is a legal arrangement that allows one partner to remain in the family home until the 18th birthday of a child — after which time the property must be sold. A “Martin Order” ensures ownership remains split but allows one partner to continue living in the property.
What happens to property ownership if children are involved?
Clearly the best thing to do if children are involved is to try and settle matters amicably. If this isn’t possible, the matter will be settled by a judge, and the need for a stable and secure home for the children will be of paramount importance. This means ownership might have to remain split until all the children reach the age of 18. It might also mean one parent is given the right to live in the home.
Can I transfer my share of the home to my partner?
The short answer is yes, but it’s not always that simple. For instance, if you’re taking on sole ownership, you will need to raise finance, and that means demonstrating to the lender that you can meet the monthly repayments. Selling the house after divorce is the simplest way to deal with things, but there are advantages to transferring ownership to one person. For example, whoever is taken off the mortgage will be free to apply for a new home loan. Also, untangling both your credit reports should give you a clean slate for the future.
How to sell a house quickly during a divorce
It is only natural to want all of the legal loose ends of a divorce tied up as quickly as possible. We believe that the best idea is to instruct a really good local High Street Estate Agent – naturally I recommend Myrings – to get the best possible price from a proceedable / well qualified buyer .There are alternatives such as selling to a national home buying company and accept that such an arrangement can work well in certain situations. However it seems to us that the best idea is to get the property expertly valued / marketed and by setting an inviting asking price generate lots of early interest If a number of buyers want to purchase then all can go to “ best & final “ offers to maximise the purchase price.
Getting divorced is always a traumatic time in a person’s life. However, settling the issue of property ownership as quickly as possible is most important and both parties can move on to the next chapter of their life without unbearable stress.
If you wish to discuss the above or are interested in the Property market in Harrogate then please come along and see us and enjoy a free no obligation chat about the services we provide.
Charles.
