Can I Buy My Partner Out of Our Mortgage?

It is very common for couples to buy a house together – and therefore share a mortgage.

However, it doesn’t matter what the circumstances are, there can come a time when you need to know if you can buy your partner, spouse, sibling, or friend out of your shared mortgage. The most common time people do this is after a breakup or divorce. This circumstance can be difficult enough to deal with – so clarity on a topic like this is important.

The short answer is: yes, it is possible to buy a partner out of a mortgage. However, to make this process a little less stressful, we have created the following guide about buying your partner out of a mortgage. It includes details of the costs involved and everything else you need to know.

First things to do when buying a partner out of a mortgage

Every person named on a mortgage is responsible for the repayments, and even if you or your partner has moved out, you are both still responsible for paying the mortgage. Only once you have a formal arrangement agreed upon can this change.

Although this can be a particularly sore time for many, it is important to maintain the mortgage repayments, or else risk having the property repossessed and a bad credit score.

Buying a partner out of a mortgage needs to be done in the right way, and it all starts with calculating the amount the other party is owed.

How to buy someone out of a mortgage

The first step of buying someone out of a mortgage is to work out the equity the other person has in the property. This can be done in a handful of simple steps:

• Ask the mortgage lender to value the house (this usually costs a small fee)
• Request a redemption certificate from the lender to get a figure for the outstanding repayments left on the mortgage
• Subtract the outstanding repayments figure from the house valuation
• Divide this figure by the number of parties on the mortgage

For example, if your property is worth £200,000 and you have an outstanding mortgage of £50,000, there is £150,000 equity in the property. Split this by two and you will have to pay your partner £75,000 to buy them out.

A divorce can make things complicated, as the split from the property is determined by the financial settlement of the divorce. This can take a while to finalise.

Can I remortgage to buy my partner out?

Not everyone has the finances to buy their partner out of a mortgage – especially since many breakups happen quite suddenly, without the time for financial preparation. When this is the case, it might be possible to remortgage in order to buy your partner out.

When you have equity in your property, you might be able to release it and use the funds to buy out, and in turn, remove your partner from the mortgage. The downside of this is that monthly repayments are likely to increase, as the loan amount increases.

Depending on the circumstances, the increase might not be too significant and will depend on the rate you are currently paying and how it compares to the new deal.

It can be difficult to get a mortgage on your own as your income might not be able to make up the difference required to satisfy the lender. However, lenders could be more likely to agree to remortgage if you are adding another person to the mortgage to pass the affordability stage.

Personal circumstances are always different, so it is best to check with the lender to confirm.

What if I can’t afford to buy my partner out of the mortgage?

There are other options if you can’t afford to buy your partner out of your house or remortgage. The first is to sell the property. Upon selling you can split the equity between all parties and have a clean break.

The downside to this option is that selling can take a while. Also, if the break-up is fractious, or there is a divorce to settle first, there can be (sometimes significant) delays.

Many people are reluctant to leave their homes. When this is the case, but it is difficult to buy your partner out, a second charge is an option available to you.

What is a second charge?

A second charge is often referred to as a secured loan. It is added to your current mortgage and the costs involved will change accordingly. A secured loan isn’t for everyone, and it is best to speak to an expert before committing.

Some homeowners seek the help of a guarantor. It is best to talk to your lender at this point to see if it is a viable option.

Can you buy someone out of a shared ownership mortgage?

The short answer is yes. It is possible to buy someone out of a shared ownership mortgage, if, as is the case with a fully owned property, you have the means to do so.

If you are in the process of remortgaging to buy the other party out of the property, then it can be good to consider buying out a higher share of the property at the same time. This is known as stair casing and can be good if you can afford it as it will save on the cost of remortgaging twice.

Before you make a decision, weigh up the pros and cons and decide whether you wish to commit to larger bigger repayments.

So how do I get a mortgage to buy my partner out?

Buying a partner out of a mortgage will often involve borrowing more money, and the lender may be able to agree to this. Known as a further advance, it will require credit checks to make sure you can afford the repayments on your own.

Then there is the option of remortgaging, potentially with a new lender or seeking a second mortgage with a separate lender. This lender will do its own set of affordability checks.

It is worth speaking to a mortgage broker at this stage as they will take into account your circumstances and can help you consider the best options available to you.

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