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Legal matters

Mumsnet has not checked the qualifications of anyone posting here. If you have any legal concerns we suggest you consult a solicitor.

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Original poster

Buy out husband but keep him on mortgage?

28 replies

ElRopo · 04/10/2019 10:49

I’m looking for some advice as to whether this is a total non-starter or whether it might be considered legally.

My husband and I want to separate (one child under 5) but, unfortunately, have just remortgaged with a five year fixed deal (our heads were in the sand about splitting up but it’s now becoming untenable). I’ve spoken with a mortgage advisor and, even though I earn a very decent salary, there is no way that I’ll be able to get a mortgage in my sole name (although this should have changed in 5 years time) but I absolutely can afford to pay the mortgage repayments on my own.

My husband needs money to find a new place to live and it’s fair that he should have that. He does not want to buy a place and will rent. We have about 40k equity in the house.

Taking this into consideration, would it be possible for us to take a snap shot of our finances at this point in time (40k equity) and for me to pay him his share which equates to 20k (my parents are generously giving me this), but for him to remain on the mortgage for the next five years although he won’t be contributing to it in any way. We wondered whether there could be a legal agreement drawn up that would state that after I give him his share of the current equity that, although he will remain named no the mortgage for the next 5 years, I will be responsible for the repayments and that he would have no further claim on the equity. In five years time I would be able to remortgage in my sole name.

Is this a completely ridiculous suggestion or could it work? (I’m in Scotland if it makes a difference)

Any advice greatly appreciated!

OP posts:

MarieG10 · 04/10/2019 18:48

I suppose there is nothing to stop him being responsible for the mortgage but you would need advice on it...wouldn't it be more like him being a guarantor?

However would he really want the responsibility as in theory the bank could come to him at any point for the duration of the mortgage for payments?

RoLaren · 04/10/2019 18:54

A lot can change in five years. He might meet someone and then not be able to get a mortgage with her.

AnotherEmma · 04/10/2019 19:05

Disclaimer: I'm in England not in Scotland so you should check with a local mortgage advisor, conveyancer, maybe Citizens Advice Scotland.

If your parents are giving you money to buy him out they might have to sign something to say that it's a gift and they don't have a claim to a share in the equity or expect you to repay them.

If possible you should try a get a mortgage in your name only but with him as guarantor (ie he will make the payments if you can't).

If he stays on the joint mortgage with you, he won't be able to get a new mortgage for his own place, even with the £20k equity buy out. Legally he will be liable for both mortgages and the lenders will probably not allow that (not unless he's a ridiculously high earner and can comfortably afford both, but I doubt that's the case or you wouldn't be posting).

pikapikachu · 04/10/2019 19:24

I think he'd want some interest if he was going to remain on the mortgage (and therefore not be able to get his own)

In theory you could not pay the mortgage and the bank would legitimately be able to come after him for payment. 5 years is pretty long. There's no guarantee that he'd be happy renting that long.

Original poster

ElRopo · 04/10/2019 19:54

Thanks for the replies and it gives much food for thought. I know there are no guarantees in life but I’m 99.9% sure he won’t buy somewhere else. Unless I’d bought our first and current house we’d still be renting (him quite happily!) He’s also not a high earner and wouldn’t be able to buy in the place we live which has very high prices (my parents gave me the deposit for the house I bought before we were married, the sale of which help to fund our current house).

I was wondering whether I might be able to get an agreement drawn up by a solicitor which states that although he’s named on the the mortgage, I would be responsible for paying it and if I couldn’t (I really could) then the house would need to be sold.

It’s probably all wishful thinking. My parents can’t guarantor me as they are retired (I’ve chatted with a mortgage advisor about this) so I feel a bit stuck and I’m clutching at straws so I don’t lose a house I’ve worked bloody hard for and put a lot of blood, sweat and tears into (and it was all me). Selling up will also mean I need to move out of town and pull DS out of his lovely school which is so frustrating when I can actually afford the repayments on the mortgage quite comfortably!

OP posts:

ChicCroissant · 04/10/2019 20:04

It doesn't sound fair to keep someone tied to a mortage for 5 years - which would impact their ability to buy or rent elsewhere - and give them no further equity at the end of it. Especially when this could be easily solved by selling the house, even with a penalty for repaying the mortgage early. Seems a very one-sided agreement, OP!

Original poster

ElRopo · 04/10/2019 20:08

Yep, it does sound one-sided I know. But it was partly his suggestion so me and DS could stay in the house. Selling up might be the only option and I know things could be worse but it doesn’t make it easy to swallow when we’re so settled here. Emotions are running high (mine mostly!) so I appreciate I might sound like I’m being unfair.

OP posts:

MrsBertBibby · 04/10/2019 20:15

It's perfectly doable, in England, I've done plenty of settlements along these lines.

You need to see a solicitor though. And Scotland may be different.

DoctorAllcome · 04/10/2019 20:16

I don’t understand why he needs cash money now to rent a place to live? If he’s not paying you any money towards the mortgage or bills...just child maintenance, then surely he would have some earnings to pay on rent?

Is there a reason why you can’t just sell the house? If you can’t be sole name on the mortgage, you probably can not afford to repay it and pay the bills, taxes, maintenance tbh.

Original poster

ElRopo · 04/10/2019 20:25

I’ll definitely go and see a solicitor, thanks everyone. I don’t want my husband to be out of pocket and the reason for ‘buying him out’ now was so he had some money to set up a place to live that is comfortable for both him and our son (renting here is also not cheap and he’s need a rent deposit etc.)

I absolutely can afford the mortgage repayments and all bills etc. I don’t think it’s unusual that people find themselves falling short of tightened affordability criteria even when the monthly payments can be met. Before I met DH I was renting a place that cost more than my current mortgage and I managed fine! There’s no reason I ‘can’t’ sell the house other than an emotional attachment to it and a school catchment attachment to it! And I will if it comes to it but surely it’s okay to explore our options first.

OP posts:

Original poster

ElRopo · 04/10/2019 20:32

Thanks MrsBertBibby.

I wasn’t sure whether the suggestion was completely ridiculous (in a legal sense) or not. Obviously I won’t (and can’t) force my husband into something he doesn’t want to do but I’ll speak to a family solicitor and take it from there.

OP posts:

user1487194234 · 04/10/2019 20:57

When you say buy him out do you envisage formal transfer of the title to you
The Bank would have to consent to this (unlikely)
But without it half the house still belongs to him
Any agreement is only between you and him so if he goes bust or has a partner/other kids and does then House is at risk and you could be paying mortgage for years for nothing

lassofthenorth · 04/10/2019 21:05

What about asking a family member to be a guarantor OP. That is what I have done in your exact situation. I can pay the mortgage and did so for a year alone but on paper I don't qualify for a loan for that much.

Can't sell without mortgage penalties for four years and I like it here.

AnchorDownDeepBreath · 04/10/2019 21:10

This would by my concern too. It's likely he'll have to stay on the deeds, if he stays on the mortgage,

lassofthenorth · 04/10/2019 21:13

he'll have to stay on the deeds, if he stays on the mortgage

Yes he will, my primary concern was getting H off the deeds.

Original poster

ElRopo · 04/10/2019 21:35

These are all very interesting points, thanks everyone.

Unfortunately my parents can’t act as guarantors because they are retired.

OP posts:

MrsBertBibby · 04/10/2019 21:42

It's perfectly easy to have a declaration of trust that provides that whilst the legal title is vested in joint names, the beneficial interest is only one party's.

AnotherEmma · 04/10/2019 22:10

Sounds like you just need to talk to a family solicitor.

I can see why you wouldn't want to sell the house. Moving is expensive (stamp duty, solicitors fees, agent fees, removal costs) and if you can afford to stay, it wouldn't make sense to uproot you and DC, change school etc.

Surely your STBXH won't need £20k to start renting somewhere. He'll need a rental deposit plus money for appliances, furniture etc. Then he'll need to pay his rent, council tax, bills and child maintenance.

If Scotland is the same as England you'll both get 25% discount on council tax btw (not going to change the big picture but every little helps).

lassofthenorth · 05/10/2019 04:28

How does that work if he racks up debts Mrs? Could a creditor still come after the house?

Tojigornot · 05/10/2019 04:40

Also, wouldn’t the mortgage provider hold him equally responsible for repayments, despite any declaration that the OP is responsible for them?

Isn’t that a fairly big ask of him? In his shoes I would have a lot of concern about that. Especially if he doesn’t earn enough to cover his own rent, maintenance payments and the mortgage payments if the OP were to default.

user1487194234 · 05/10/2019 07:42

Yes as far as the mortgage co is concerned he would retain liability (joint and severallly for whole mortgage)
Any agreement operates between you and him only

BoomBoomBoomLetMeHearYouSay · 05/10/2019 07:48

If he is staying on the mortgage that means him also staying on the deeds ie the house is half his.

Possibly you could draw up a private agreement overriding that but you would need advice on whether that private agreement would be enforceable. Such a private agreement also likely not to be something your mortgage company will agree to. They don’t care what you’ve agreed with him; they just want to be able to enforce their mortgage if need be. So they won’t agree to something that limits his liability for the mortgage.

In short you should take advice but I think this is unlikely to work and you may need to think about a smaller place.

Mumtoaperfectbabyboy · 05/10/2019 07:52

My friend bought a house with her partner and they broke up quite quickly after than. In reality she could easily afford the repayments herself but on paper the affordability didn't tally. She called the mortgage company to ask her options and was told if she paid by herself for say 6 months and had proof that she had done it alone then he could be removed from the mortgage and it could be in her name.

Carrotcakeyum · 07/10/2019 14:26

@ElRopo I think what you are both trying to do makes perfect sense. You have been given good advice here. It's just a matter of finding the best fit that works for everyone involved.
I have just done 5 year fixed mortgage. Penalty would be £8,000 - £10,000 early redemption. Throwing a lot of money to the wind!
Hope you find the best solution that works for everyone.

Original poster

ElRopo · 07/10/2019 14:56

Yes, I’ve looked into our early repayment charges and they are similar Carrot. So those, plus estate agent and solicitor fees to sell (£5k), plus stamp duty and solicitors fees on a new place and nearly all of the equity has gone.

I’ve done some calculations and I will meet the affordability criteria to remove STBEH from the the mortgage in 3 rather than 5 years time (after I’ve paid three years of the mortgage and my salary has increased (I’m on a salary scale so know exactly what I’ll be earning)). But we’re going to get some legal advice and see what we can do.

OP posts:

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