Divorce and Mortgages

Other Mortgage Issues

Applying for a mortgage on your own, after a divorce, can be a very time consuming and troublesome issue. For many people, it is the first time that they have ever had to 'go it alone'; it is also likely to be a very emotional time, adding to the stress and strain of trying to juggle monthly mortgage payments.

Mortgages & Maintenance Income
As mentioned previously, many lenders will now offer a mortgage to the remaining party based on maintenance income. Traditionally, lenders have only used maintenance payments if they have been set by the court; this is not always the case anymore and many lenders will now consider maintenance payments that have been set privately or unofficially.

It is worth bearing in mind that if your ex-partner dies, these payments will stop, thrusting you into potential financial hardship. For this reason, lenders may encourage you to take out life insurance on your ex-partner's life to ensure that you are able to meet payments in the event of the death of your ex-partner.

Other Sources of Income
As soon as you become aware that you are going to require a mortgage in your own name, it is essential that you apply for any benefits to which you may be entitled. Most lenders are now prepared to consider items such as child tax credits as part of your regular income. Therefore, ensuring that you have an accurate statement of how much you will receive will be vital to your mortgage application.

Issues to Consider with a Divorce Mortgage
When arranging a mortgage after divorce, you may find that you have individual circumstances which are unusual. For this reason, it is often a good idea to speak not only to your current lender but also to specialist divorce mortgage providers.

Some lenders, such as the Yorkshire Building Society, have developed a specialist mortgage aimed at giving advice and assisting people going through a divorce or relationship break up. As part of this mortgage, borrowers are given a zero percent mortgage for the first 6 months, thus enabling them to spend some time sorting out their affairs without the immediate pressure of having to meet financial obligations.


Summary
Often, in the case of a divorce mortgage, your circumstances are not standard and specialist mortgage advice will be necessary;
maintenance payments can often be considered as part of your income, so make sure that you have the necessary details with you when meeting with your lender;
specialist divorce mortgages are available that offer greater assistance such as interest free periods, initially, so shop around for your best mortgage option.