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Divorce/separation

Here you'll find divorce help and support from other Mners. For legal advice, you may find Advice Now guides useful.

Original poster

I'm wondering what is possible in terms of finances and house split . ..

23 replies

sososadaboutthis · 07/12/2023 06:51

I will be talking to a solicitor as soon as one gets back to me (😬) but in the meantime I wondered if anyone could offer some thoughts on whether it might be financially viable for me to buy my STBXDH out of the house.

I earn £43k, he earns £25k
House is worth approx £300k. There is a £50k mortgage

He did put more into the house initially, but if the house ended up being split 50/50 do you think there's any way I could afford to buy him out on my salary? There's a chance I could have some money from my parents as an early inheritance type thing...

I'm trying to think of ways to maintain some stability for the kids and to keep STBX's business going for now.

Thank you

OP posts:
DustyLee123 · 07/12/2023 06:53

You need to look at pensions too, I assume yours is bigger, so he might end up with a bigger percentage of the house.

SheilaFentiman · 07/12/2023 06:56

How old are the kids and have you talked about residency arrangements?

Original poster
sososadaboutthis · 07/12/2023 07:10

We had a brief conversation about the fact that he can't afford to buy me out of the house but that it would be best for the kids to remain living there (with me)
The kids are 8 and 11

OP posts:
Original poster
sososadaboutthis · 07/12/2023 07:10

Yes my pension is bigger

OP posts:
BobBilby · 07/12/2023 07:13

Have a look at mortgage calculators. It looks like you’d need to give him £125k as his half of the equity. So if you can afford the mortgage plus what you have to give him then keeping the house seems best for the kids stability.

LemonTT · 07/12/2023 07:28

The outcome is likely to award him more of the equity in the house because his income is so low. The pensions will be equalised. You might only get 30-40% of the equity, assuming you are in England. Maybe c100k, depending on how you treat your pension. A lump from your parents might mean you could afford to buy him out. A mortgage calculator will give you a rough estimate of how much you can borrow.

The things that won’t matter is who paid what and who is the resident parent. You both have equal housing requirements but his borrowing capacity is lower.

You could argue he should isn’t maximising his income. But sometimes judges aren’t interested in that. 25k per year is a low salary.

The idea that you are entitled to 50% or that it is a starting point is the most common misconception. Assets are split according to need and low earners have higher needs.

And you need to decide if you want to share your pension and if not whether you take a lot less equity.

Another consideration will be who receives benefits. Which would bolster his income and maybe not yours.

PosiePerkinPootleFlump · 07/12/2023 07:33

How much are each of your pensions worth?
As well as a fair split of assets, both of your needs will be taken into consideration (including housing needs), as well as stability for the children

Original poster
sososadaboutthis · 07/12/2023 07:35

LemonTT · 07/12/2023 07:28

The outcome is likely to award him more of the equity in the house because his income is so low. The pensions will be equalised. You might only get 30-40% of the equity, assuming you are in England. Maybe c100k, depending on how you treat your pension. A lump from your parents might mean you could afford to buy him out. A mortgage calculator will give you a rough estimate of how much you can borrow.

The things that won’t matter is who paid what and who is the resident parent. You both have equal housing requirements but his borrowing capacity is lower.

You could argue he should isn’t maximising his income. But sometimes judges aren’t interested in that. 25k per year is a low salary.

The idea that you are entitled to 50% or that it is a starting point is the most common misconception. Assets are split according to need and low earners have higher needs.

And you need to decide if you want to share your pension and if not whether you take a lot less equity.

Another consideration will be who receives benefits. Which would bolster his income and maybe not yours.

Thank you..this is really helpful information and will give me a good starting point when examining my financial options

OP posts:
Original poster
sososadaboutthis · 07/12/2023 07:36

PosiePerkinPootleFlump · 07/12/2023 07:33

How much are each of your pensions worth?
As well as a fair split of assets, both of your needs will be taken into consideration (including housing needs), as well as stability for the children

I need to find this out, but mine is definitely worth more

OP posts:
SheilaFentiman · 07/12/2023 07:40

Bear in mind that you don’t have to go to court, if you can reach agreement separately

Original poster
sososadaboutthis · 07/12/2023 07:48

SheilaFentiman · 07/12/2023 07:40

Bear in mind that you don’t have to go to court, if you can reach agreement separately

Thank you, yes that would be the plan

OP posts:
SheilaFentiman · 07/12/2023 08:22

By which I meant - PPs are saying what a judge would say, but you and XH, if amicable, may come to a different arrangement about what is fair re housing the kids, him having sufficient space for overnights etc

Mumof3confused · 07/12/2023 14:56

If I were you, I’d get an idea of my maximum mortgage capacity and then have a conversation based on this. Max out your mortgage and offer to pay him what you can. Speak to a mortgage adviser so that you have this information when you’re speaking with the solicitors. Based on your salary you are unlikely to be able to borrow what you need from the bank.

Bear in mind though that your equity is what you would get if you sold the house. You need to also allow for estate agents fees, VAT and early repayment fees on the mortgage. If the house would sell for £300k the equity isn’t £250k

Do you have other assets?

Original poster
sososadaboutthis · 07/12/2023 16:31

Mumof3confused · 07/12/2023 14:56

If I were you, I’d get an idea of my maximum mortgage capacity and then have a conversation based on this. Max out your mortgage and offer to pay him what you can. Speak to a mortgage adviser so that you have this information when you’re speaking with the solicitors. Based on your salary you are unlikely to be able to borrow what you need from the bank.

Bear in mind though that your equity is what you would get if you sold the house. You need to also allow for estate agents fees, VAT and early repayment fees on the mortgage. If the house would sell for £300k the equity isn’t £250k

Do you have other assets?

Edited

Thank you for this. No, there's no other assets

OP posts:
thelonemommabear · 07/12/2023 20:11

I'm the higher earner than my ex husband like you - pension worth 10x his. He earns similar level to your husband. Judge signed off on a 65/35 split of the house equity - in my favour. Agreed to no pension splitting so I walk away with it all on the basis of

  1. He could earn more but chooses not to
  2. Realistically it will be me that supports our children as teenagers and young adults financially and to buy him out I'd need to extend mortgage past retirement age so need all my pension
Mumof3confused · 07/12/2023 22:50

@thelonemommabear this is great to hear. Was this agreed amicably or at FDR? Final hearing? Assuming there was enough equity for him to rehouse and set himself up with his share.

thelonemommabear · 08/12/2023 08:25

@Mumof3confused
Agreed between the two of us. But judge signed off. No the equity is around £50k for him. On earnings of £23k per year for him I doubt he'd get a mortgage. So I suppose he could use it towards rent - more than likely he'll just fritter it away though. We have 3 children but I doubt he'd rent more than a 2 bed at maximum but with rental costs probably only a 1 bed. I'm not really bothered to be honest. I wrote a supporting bit with the forms that he could maximise income but chooses not to and isn't pursuing having the kids overnights. I have childcare bills of £2k per month (twins) and that will continue for the next 10 years at least - the £50k is the max that could be afforded

Hols24 · 08/12/2023 08:29

LemonTT · 07/12/2023 07:28

The outcome is likely to award him more of the equity in the house because his income is so low. The pensions will be equalised. You might only get 30-40% of the equity, assuming you are in England. Maybe c100k, depending on how you treat your pension. A lump from your parents might mean you could afford to buy him out. A mortgage calculator will give you a rough estimate of how much you can borrow.

The things that won’t matter is who paid what and who is the resident parent. You both have equal housing requirements but his borrowing capacity is lower.

You could argue he should isn’t maximising his income. But sometimes judges aren’t interested in that. 25k per year is a low salary.

The idea that you are entitled to 50% or that it is a starting point is the most common misconception. Assets are split according to need and low earners have higher needs.

And you need to decide if you want to share your pension and if not whether you take a lot less equity.

Another consideration will be who receives benefits. Which would bolster his income and maybe not yours.

His income is lower but the OP will be housing the kids, which may well balance that out when deciding on the division of assets.

ChimneyPot · 08/12/2023 09:06

Does your DHs business have value? Is it a company? Are you a shareholder?

Original poster
sososadaboutthis · 08/12/2023 09:46

ChimneyPot · 08/12/2023 09:06

Does your DHs business have value? Is it a company? Are you a shareholder?

No, it has no value. At the moment it's really just a building with the occasional client booking in. It had been growing until lockdown happened and now isn't really making anything apart from the occasional client. I don't want to share what it is as it's too outing. But he couldn't just start it up elsewhere

OP posts:
Original poster
sososadaboutthis · 08/12/2023 09:47

ChimneyPot · 08/12/2023 09:06

Does your DHs business have value? Is it a company? Are you a shareholder?

No, it has no value. At the moment it's really just a building with the occasional client booking in. It had been growing until lockdown happened and now isn't really making anything apart from the occasional client. I don't want to share what it is as it's too outing. But he couldn't just start it up elsewhere

OP posts:
Tosca23 · 10/12/2023 10:16

Sounds to me like 55:45 split in your favour may be fair if you can buy him out now. He may accept 50:50 in a worst case scenario so he can be bought out of the family home now.

With court, a mother housing kids will usually be given a larger share but your higher income could go against you. Still personally i doubt you'd get less than 50% and if you keep it amicable and out of court you may be able with help from your parents to keep the house - fingers crossed and best of luck. You need to sit down and figure out the sums.

Original poster
sososadaboutthis · 10/12/2023 11:49

Tosca23 · 10/12/2023 10:16

Sounds to me like 55:45 split in your favour may be fair if you can buy him out now. He may accept 50:50 in a worst case scenario so he can be bought out of the family home now.

With court, a mother housing kids will usually be given a larger share but your higher income could go against you. Still personally i doubt you'd get less than 50% and if you keep it amicable and out of court you may be able with help from your parents to keep the house - fingers crossed and best of luck. You need to sit down and figure out the sums.

Thank you, yes I do need to work out the sums and I will starting to do that now. Had a free consultation with a solicitor which helped a lot. She feels that even though my salary is higher, because they are both still modest salaries it won't count against me really. She also said the same about housing the kids. I'm having the house valued on Monday and will get an agreement in principle soon so I know how much I can borrow. Hopefully then things will be a bit clearer.
Thank you everyone for your input, really helpful.

OP posts:
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