Hi all,
just come across a recent divorce financial settlement court case in which the judge made an interesting decision to divide the equity from the sale of the former matrimonial home (FMH).
Basically, the couple had divorced 7yrs earlier without completing their financial settlement. The husband had stayed in the FMH and the wife moved out. Rather than dividing the equity of the house 50/50, the judge factored in that the husband had been solely paying for the mortgage etc and so the judge decided to deduct the husband’s capital mortgage payments from the total equity of the house. The husband’s mortgage payments following the separation were deemed to be ‘non-matrimonial’ by the judge.
I’ve never heard of this before - for my case, it’s fantastic news as I’ve payed the mortgage etc on the FMH by myself for the past 5yrs since separating from my ex (we’re now divorced)! Has anyone heard of this before? On this board and other Mumsnet boards, it’s always been said that one person paying the mortgage after separation/divorce is not factored into the division of equity - it’s all considered to be matrimonial.
Details from the court hearing decision are below:
https://www.bailii.org/ew/cases/EWFC/OJ/2025/19.html
Computation
41. Computation is relatively straight forward in this case. The working figure for the Equity is agreed at £272,466.
42. However, the degree to what amount - if any - of that sum falls to be considered as a non-matrimonial element is not agreed.
43. The Husband's assertion that c.£130,000 can be removed from the equation is an unattractive one. It presumes that all mortgage repayments post-marriage have been paid against capital rather than significantly against the interest, or indeed, at all. This is unrealistic.
44. I take judicial notice that Bank of England base rate has been below 1% for the majority of the period in question until it began to rise to its current 4.75% during 2022. I also take judicial notice that, were the Husband to have had a fixed-rate mortgage product at a relatively low interest rate, the proportion of any monthly payment would have been applied more significantly against the capital, whereas a higher interest rate may well have resulted in a higher application against interest. By way of illustration, I take judicial notice that historic products during this period have varied widely whereby borrowing at 1% might have seen 14% of a monthly repayment sum being applied against interest, whereas borrowing at 5% could see interest payments counting for more thank half of a monthly instalment.
45. Using those parameters as a rough guide, and with the consent of the parties and counsel to my effectively making a rough 'guestimate' of the historic payments, I assess the Husband to have made c.119 post-separation payments in the region of £119,000, of which 71% is taken to have been by way of capital repayment and 29% interest payments.
46. That realises a computation sum of c.£85,000 as having been paid against the capital which will be treated as non-matrimonial and deducted from the Equity of £272,466. Because it is common ground that the Wife left the FMH and was in a new cohabiting marital relationship soon thereafter, this is not a case that realistically falls to consider her as being excluded from the FMH for purposes of an occupation rent liability, at least from the point of her remarriage.
47. The amount of the Equity that falls to be divided between the parties as a matrimonial asset is therefore £187,466. Were that to be divided equally it would realise £93,733 for each party.