Help with buying house after divorce

[twosmallbuttons]

I'm in the early stages of divorce, and am trying to get my head around what I'll be able to afford once we sell the house. I haven't talked to STBEX about the possible house split yet, just want to get a sense of what's possible. The mortgage is in both our names.

The house is worth in the region of £875,000. We have £270,000 left on the mortgage.
Assuming a 50/50 split that leaves £605,000. I'm guessing costs of selling/moving need to be deducted before we split the remaining equity.

Q1 - Can I only use half the mortgage amount from the existing mortgage to go towards a new property? Ie £135,000? Or will it depend on my income?

Q2 - If a family member were to give me a loan to help buy a property, would this affect the financial order we agree in the divorce? Or should they wait until we've got the Decree Absolute before loaning it to me?

There isn't enough info there op. Kids/pensions/savings/earnings/future earnings are all taken in to account.

We have 2 DC aged 10 & 8. I guess I can't really work anything out properly until we've done the equivalent of Form E?

I have no savings (long story), DH has minimal savings. His pension is currently £120,000. Mine is half that.
Joint earnings were around £70k, my earnings are much less than half though (more like £20k). I expect this to remain about the same until both DC are at secondary school at which point I can work more hours.

Are you the main carer?

I am, although STBEX wants a 50/50 childcare arrangements. He works full time, I've always been part time since kids (and hence historically the main carer)

He is unlikely to get 50/50 unless you had the same income, you may get more of the equity but you will need to fight for it if he disagrees.

The way it works if neither of you are buying the other out is:
-sell the house
-pay the current mortgage off in full

• split the remaining equity in whatever percentage agreed or dictated by court.

You will need to get a new mortgage and how much you can borrow may depend on your income alone. I strongly advise using an independent mortgage broker as they would be able to find you a deal that takes child maintenance and any financial support you may get as income for the mortgage entitlement calculation.

Using an independent mortgage advisor doesn’t need to cost you a penny, as many work on commission.

I'd be surprised if he got 50/50 or that he even wants 50/50 - possibly just threatening you with that?

Anyway, based on what you've said - it isn't going to be 50/50 split. You will get more. But it will totally depend on whether that 50/50 childcare split is agreed.

Fwiw, I've just had my consent orders stamped by the court. Similar ish figures, but I'm having our girls (similar ages) 5/2. We went 50/50 on equity (ish, difficult to work out as pension isn't exact) but I have got a very generous spousal maintenance amount until our youngest is 18.

Because of the age of your children, it's a lot about 'need' rather than what's fair.

The first thing to get to the bottom of - is does he really want 50/50? Careful how you question it to him.

@KarmaNoMore do you mean he's unlikely to get 50/50 of childcare or on the house split?

Thanks, I will look at mortgage brokers.

@arethereanyleftatall I'm happy for him to try do 50/50 childcare if he thinks he can. We're trying to keep it amicable, I am very nervous about my less-than-great financial position so want to get the best deal I can without getting the courts involved.
I have a small feeling he will try to agree 50/50 childcare as a way of making everything 'equal' and so he doesn't have to pay/relinquish more than he absolutely needs to.

Am I naive to think we don't need solicitors involved from the outset?

I suspect that that is exactly why he's going for 50/50. He knows full well that you will get far more if you have the children for more. Ot course he wants to 'keep it amicable' that means he wants to give you the least he can get away with.

Our solicitors took our earnings and earning potential in to account. So, since we had our dc I did all the childcare and worked only around them, whilst he had free rein to further his career. He did that to the point that he earns 15x what I do. Hence the spousal maintenance. If your career has been sacrificed in any way to raise your children, spousal maintenance is fair.

We saw mediators to begin with, they guide you through what to do and aren't too costly.

I think with the amount of money involved you will need solicitors in the end but may be able to keep it to just a few k each.

My career was/is definitely on hold, we worked in our joint business til I left 2 years ago so both incomes were from the same source. I'm still getting dividends now thankfully, although I now work in a completely different industry (low paid).

I still intend to arrange my work hours around DC's schooling etc. It will be difficult for DH to do the same despite his promises but perhaps I should take a firmer stance from the beginning?

I would op.

My view was - we still have one 'pot' of money to bring our children up with even if we live separately. It costs more to live separately. Therefore it makes sense to maximise the pot. If your ex earns 5x what you do, now is a silly time to be reducing that pot.

Mediation was good. They do everything and nothing. Basically they just sat there whilst ex and I sorted out stuff and guided us through what to do to work it out. Because they're 'watching' neither of you will try to take the piss, and they will guide you if it looks like that's happening.

50/50 of the assets. The court would like to leave on an equal footing so you may get more equity because he has a higher earning power and pension.

By the way, there is not a life changing difference on the amount of money you will get in child maintenance if he has the kids every other weekend or 50% of the time. My guess is that you both are trying to keep contact equal because he may be thinking that taking care of the kids equates to feeding them after school and putting them to bed, they do not realise that also involves missing days at work to take care of sick children, limiting their career as they cannot work as many extra hours or having to use their holidays to take care of the kids when there is no after school club.

It is not always on the best interests of the children to split the time 50/50, in some cases it works much better for everyone for the kids to have a house as their main base especially when they start secondary school and become more independent, want to be closer to their friends and have more equipment to forget at the wrong house.

By the way, with regards to question 2. Yes it might do, as if it goes to court he can say that you will be in receipt if a significant amount of money and that may and can be considered for the split, so do not even mention it until you have separated the assets.

Op, you may be able to get UC. It won’t be much on that salary but can help with the cost of holiday clubs, after school clubs, etc.

By the way, I need to take part of my last post back: if you do 50/50 with contact he doesn’t have to pay any child maintenance so given you have a smaller income fight against that, you need that money to keep at least a pretence that the kids have a slightly similar standard of living in both houses.

@KarmaNoMore and @arethereanyleftatall thank you for all this, it's very helpful.

I thought as much re Q2. I will keep quiet!

I think I do need to get more childcare in my favour, for all the reasons you mentioned, financially and because I don't physically see him able to cope with doing his share with the hours he works. I do not want them being put in after school club/sent to his mum's each time he has them (although technically he can do that if he wants I suppose).

So say I ask for me doing 3 weekdays, him doing 2 weekdays, then each of us EOWeekend, would this be enough for it to work significantly in my favour? Or should it be even more (4 days + EOweekend)?

CM is not calculated exactly pro rata, but you may check the [https://www.gov.uk/calculate-child-maintenance CMS child maintenance calculator] to get an idea of how the number of nights the kids stay on each house affects your cm entitlement.

It would also be a good idea to apply for UC if you haven’t yet, you don’t need to wait until you move out. You can calculate your entitlement at entitledto.co.uk. You don’t need to use UC for childcare, I guess most of us have used it to make it easier to pay to have a roof over our children’s heads, uniforms or groceries 🙂

You're welcome op. It's all such a minefield, none of us know anything about it before we embark, it's massive year long learning curve!
Put all the variables in to the child maintenance calculator on the gov website. 1 day, 2 day etc. Have all this in your brain before you speak to him.
I think on top of the 13 weeks normal school holidays a year, there was probably easily another 4 -8 weeks I did as a sahp on top - illnesses, inset days, occasional days, dentist appointments, school plays etc etc. If he's doing 50/50 then he will have to cover that 50/50. So, he will need to cover approx 10 weeks full days as well as after school and before school care on 'his' days.
My ex went for two days, and then said 'so, I'll pick up the girls from yours on my way home at 6.30pm.' Um, no, no you won't, they finish school at 3pm.

@twosmallbuttons you will absolutely need to get legal advice. Even if you sort things out through mediation you will need to get legal advice on the agreement. Please don’t sell yourself short thinking it will keep things amicable. You don’t have to be adversarial but you do need to be realistic about your ability to get a mortgage and a reasonable level of income if you have been out of the workplace for sometime.

So £180k pension between you. That will mean 90k each. Court will make a pension sharing order. His savings will be split between you. Any debt eg credit card, will be shared you too irregardless of who's name it is in. All assets eh. Cars, jewelry etc are all put into melting pot and value shared. As your earnings are far less than his you might be awarded 65 percent of value of equity after mortgage has been repaid. If you have children 50/50 make sure agreement states any before or after school clubs or child care is paid by person who has access that day. Only one person can claim child benefit. I think you might have to share that money if you have 50/50 care. This means you both buy children clothing and share costs of school trips etc. If you got 60/40 care you would probably claim it but buy more clothing for children. No matter how amicable you want to remain I would still pay for a solicitor as sounds like he wants to do without one which means you getting a far poorer deal. E.g. you thought you would share equity 50/50 but as your earnings are lower that would not be fair. Did you stay home with children whilst they were very young or go part time to enable you to care for them? A solicitor will ensure that is taken into consideration in equity split. My ex and I drew up agreement stating I would be responsible for buying son clothing but he would pay half for school trips. He also agreed he would take son on holiday and pay for this and if I took him I would pay got it. We agreed to pay half each for all after school care and weekend activities eg Music lessons so he would not miss out. I got a chunk of his pension do we both walked away with an equal amount. I got custody and he had son every other weekend and one sleepover every week. He got son for a week in summer holidays every year but sometimes he asked for 2 weeks and Boxing Day which is what son wanted to live with me but still see his Dad. He did not want to move to and fro all the time and said he wanted Xmas day with me. Ex had to pay child maintenance got child which he did not do consistently. He also used to cancel son for weekend if he wanted to do something with new gf. He was supposed to pay £145 each week for child maintenance. Eventually CSA challenged him about arrears and they did something to get his employer to take money out of his pay and pay it to CSA then they paid it into my bank account. This carried on whilst son was in education. Make sure you get formal agreement as then CSA can enforce it.

I've done the CMS calculator so have a rough idea now. The more I think about it the more I'm convinced he's deluding himself trying to get 50/50. It has to be what's in the best interests of the children, right?!

@FVFrog yes you're right. I have a phone call with a solicitor on Monday so will ask about all this.

@twosmallbuttons best of luck, it’s an exhausting emotional rollercoaster no matter how amicable you are and even if it’s a joint decision. Be kind to yourself and lean on your friends and extended family if you have them, you’ll need them.

Thanks @caringcarer this is helpful. I wasn't sure what I would get from his pension either so this is interesting. Is this what normally happens? Eg if STBEX questions it where can I show evidence that this will be expected?

Yes I stayed at home fully for 3 years until DC2 was 1, at which point I did 2 days per week for a few years, later went up to 3 days per week. My current job fits in around DCs schooling, apart from 1 evening and 1 weekend day per week, where STBEX stays home. So yes the last 10.5 years have been considerably affected by me raising the DC. STBEX does what I consider a 'normal' amount for a full-time worker, ie does evening things and lots at the weekend, but holidays are just not the same when he has to work.

@FVFrog thanks, MN is already giving me much needed info and wisdom plus a few family members are being absolute heroes. I just feel a bit clueless when it comes to finances and going it alone, so want to get all my ducks lined up asap!

@twosmallbuttons, point out to him your pension contributions were adversely affected by staying at home for 10 years during childcare duties while he continued to contribute to his pension as he did not stay home to care for children. Yes, Pension Sharing is very normal and courts expect it. You need to get a solicitor to set for you what you entitled to. I have read in the past people who do not use a solicitor for negotiation tend for the parent who has taken on the caring role to come off far worse financially than if they had one. It sounds like your stbexh is hoping you won't realise what you are entitled too. Put cost of solicitor on your credit card as that debt will be shared. You will only get one chance to submit form E and make an agreement as to who gets what. You have got to fight for what you are entitled to for the sake of your children. A solicitor acting on your behalf would get you Pension Sharing order as standard and negotiate for you to have a larger portion of equity due to you earning less money. Are you planning on going back to work full time if your stbex wants 50/50 childcare? Or is he expecting you to continue to look after the children for most of school holidays? You have to consider even if you got 60-65 percent of equity in house with only £20k would.you be able to buy another home/get mortgage? It will depend where you live, if in Midlands or North probably but if in London or SE probably not. If you spent £700 on a few sessions with s solicitor and preparation of Form E you would get back thousands more than more than if you muddled through alone with stbexh telling you 50/50 and keep.own pensions and savings is fair.