Divorce has been on the increase since the Covid pandemic, with the rate of couples legally severing their ties in Scotland now standing at approximately 33%. However, this does not account for the number of co-habiting couples who also separate.
In 2022 law firms reported a boom in separation enquiries on what has been dubbed “divorce day” – the first Monday of the new year. The period after the festive holidays has always been the most popular for couples to take the first steps towards divorce, but the added pressure of nearly two years of lockdown restrictions and associated financial challenges led to a bigger-than-usual surge in queries.
READ MORE: Mortgages & divorce: More Scots fighting over low-cost deals
Around that same time the Bank of England began a steady campaign of raising interest rates in a bid to keep inflation under control. The cumulative effect of this has as of earlier this month pushed mortgage rates to a 15-year high, adding hundreds of pounds to monthly repayments.
This has created additional strains for divorcing couples who have a joint mortgage on their home.
What am I entitled to if I divorce my partner?
If you are married, the rules of the Scottish family law apply. In general each party is entitled to a fair share, normally 50%, of the net matrimonial assets which are the value of anything accumulated by the efforts of one or both parties during the marriage, less the value of any debts accumulated during that period. The general rule is that if you owned a property prior to marriage, this would not form part of the matrimonial assets.
Why might there be a problem if my ex-partner has already agreed to sign over the house to me?
If the mortgage was originally obtained based on the joint incomes of both partners, the bank or building society may refuse to allow one to be removed from the mortgage and the property title. This depends on whether the sole partner’s income meets the affordability criteria set by the lender.
What happens if neither of us meet the mortgage lending criteria?
If the loan can’t be devolved to a single borrower, that may mean the house has to be sold to allow the mortgage to be repaid in full. Both spouses would then need to find new sole mortgages and purchases on what would likely be smaller properties.
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