Dividing the family home and mortgage during separation if you were living together

Are you in the early stages of separating and want information about protecting your rights to live in the home? Then it’s worth reading our guide Protecting your home ownership rights during separation if you were cohabiting.

If you and your partner jointly own the family home, you have several options for how to divide it.

You might decide to:

• Sell the home and both of you move out. You could use the money you’ve raised to put towards buying another home for each of you, if you can afford to do this.
• Arrange for one of you to buy the other out.
• Keep the home and not change who owns it. One partner could continue to live in it, perhaps until your children are 18 or leave school (if you have any).
• Transfer part of the value of the property from one partner to the other so your children have somewhere to live. The partner who gave up a share of their ownership rights would keep a stake or ‘interest’ in the home. This means that when it’s sold, they’ll receive a percentage of its value.

If you and your partner are splitting up and you have children, it’s important to think about where they’ll live.

As a couple who live together but aren’t married or in a civil partnership, you don’t have any obligation to support each other financially after your break-up. But as parents, you’re expected to pay towards the cost of your children.

One parent might be able to make a claim against the other for the right to remain in the family home.

How you do this – and the laws that give you these rights – vary throughout the UK. 

It doesn’t mean the person who remains in the home would own it, or own a share of it – but they might be given the right to live there for a certain number of years. This would usually be until the youngest child reaches a certain age.

If the home is only in your ex-partner’s name – you might be able to make a claim for a share of its value.

There are different laws that enable you to do this, depending on where in the UK you live.

This is a complex area of the law and it’s essential to get advice from a solicitor who specialises in the law relating to cohabiting couples.

Have you paid towards the mortgage, or towards improvements or an extension? Then you might be able to establish what’s called a ‘beneficial interest’. This could mean you’ll be able to claim a financial share of the property, or the right to live in it.

Did your ex-partner buy the home in their name but you had an understanding or agreement that you’d have a share in its value when it was sold? Then you might have a beneficial interest.

Making a financial contribution doesn’t mean you’re automatically entitled to a share in the property.

But you can make a claim – even without you and your ex-partner having signed a formal legal document saying you’re entitled to a share in the property.

You’re entitled to get back any money – for example, mortgage payments – you’ve contributed towards the family home. But there are two conditions:

• You must be able to provide evidence of the payments you’ve made, through bank statements or similar.
• You’ll only be able to receive a payment if there was enough equity in the property at the time you and your ex-partner separated.

You might be able to make a claim if you’ve been ‘economically disadvantaged’ – or your ex-partner has been ‘economically advantaged’– by the relationship. This could be because:

• you’d given up work to look after your children
•  you were persuaded by your ex-partner to sell your property and move in with them
•  your ex-partner is able to buy property because of the financial contribution you’ve made.

You only have one year from when you separate to make a claim – so it’s best to get legal advice as soon as you can.

Many couples who have a joint mortgage and split up usually try to separate the mortgage so only one partner has their name on it.

Whether this is possible depends on the couple’s financial circumstances.

The advantages of doing this are:

• The partner who stays in the house doesn’t have to rely on their ex-partner for their mortgage.
• The partner whose name is taken off the mortgage should be able to borrow more to buy themselves a home than if their name was still on their ex-partner’s mortgage.
• Both partners might be able to break the link that ties their credit files together. If you have a joint debt with your ex-partner – for example, a mortgage or a loan – your credit files are connected. That means how you manage your debts will affect your ex-partner if they apply for credit, and vice versa.

If you want to take over the mortgage in your name alone, your lender will want to make sure you can afford the payments.

Under Financial Conduct Authority (FCA) rules, lenders must ask in-depth questions and carry out more checks to make sure you can afford a mortgage.

If you can’t afford to take over the mortgage, you might be able to get a ‘guarantor mortgage’.

This is a mortgage where a close relative agrees to guarantee the mortgage payments if you can’t.

Becoming a guarantor is a serious legal step as it means taking on the responsibility for paying the mortgage if the mortgage borrower can’t.

Before making a decision, it’s important that anyone considering being a guarantor: 

• gets independent legal advice, and
• talk to a mortgage adviser before agreeing to it.