Equity release before divorce?

[cheeky_chops]

Wondered if anyone has any experience as starting separation now.

Im 41, shes 43. House is value of £420k with under £200k owed in joint ownership. One option i was told is its possible is remortgage the house under joint ownership so taking mortgage to say £300k. Solicitor manages process where I take £100k cash and signing over house to ex. Mortgage co are informed but equity keeps them onside.

Seems easier than selling as we can split when cash comes thru, kids stay in the house too. Problem i see long and short term is she earns £50k so will struggle to pay 6times earnings. No debts, £20k in cars/cash

Is any of this even possible/recommended?

[kiethton]

Speak to Sarnie, if anybody knows he can help he is well placed

[BoRED S2upid]

Pretty sure the bank will be asking your wife to prove how she can afford to pay the £300k mortgage on her own when you sign it over. Thats your biggest hurdle.

[RSoovy4]

BoRED S2upid said:

Pretty sure the bank will be asking your wife to prove how she can afford to pay the £300k mortgage on her own when you sign it over. Thats your biggest hurdle.

This I'm afraid.

They won't lend at 6x income, I wouldn't have thought.

[Sarnie]

kiethton said:

Speak to Sarnie, if anybody knows he can help he is well placed

Keith

5x income is generally the maximum borrowing, but it is possible to go slightly higher depending on the case as a whole (LTV, credit score, income etc).

The equity in the property won't satisfy the lender on it's own, the case would need to satisfy all other criteria.

Your first port of call should be your current lender, as if they are one of the lenders who won't do 5x income then your scuppered and will have to consider remortgaging to another lender who will.

If you need some more specific mortgage advice, drop me a PM

[cheeky_chops]

We are with Skipton and in a 2year fixed until end of Sept. Been with them 7 years. She did mention here parents were going to come in with some cash but i cant see them putting up nearly £50k to bring her back to 5x. I could be wrong

The deal was i move out to my brothers until i get the cash so its back to square 1!

[Sarnie]

cheeky_chops said:

We are with Skipton and in a 2year fixed until end of Sept. Been with them 7 years. She did mention here parents were going to come in with some cash but i cant see them putting up nearly £50k to bring her back to 5x. I could be wrong

The deal was i move out to my brothers until i get the cash so its back to square 1!

Skipton will only do 4x income.

Are you looking to buy your own place after being taken off this mortgage?

[ellroy]

BoRED S2upid said:

Pretty sure the bank will be asking your wife to prove how she can afford to pay the £300k mortgage on her own when you sign it over. Thats your biggest hurdle.

But depending on the divorce they may well take into account maintenance payments that the OP is more than likely making as well.

OP I'd be talking to the lawyers as well to find out your likely ongoing cost to the ex and kids.

No point taking out that much equity if you still pay a huge monthly amount to her and cannot afford a suitable place of your own.

[Amateurish]

Let me know if you need a recommendation for a lawyer - you really should be speaking to one at this point before you make any decisions.

[Rude-boy]

^^^

And, as I am sure Sarnie will advise you if you speak to him, you need to be very careful when reading the T&C's of any offer you apply for. Particularly the declarations regarding your circumstances. No point in getting yourself into a muddle with lenders just to speed things up a little.