Divorces can bring about severe financial challenges, including legal costs and the costs associated with shared property and mortgages.
There were around 80,000 divorces in the UK in 2022 alone, and unravelling the issues associated with joint mortgages is becoming relatively common.
For instance, while you might be holding a joint mortgage with your ex, you might also want another one for a new property for yourself.
But is it possible? Can you get a second mortgage if you already have one with your ex-partner?
This article will answer all your questions.
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Can I Get a Mortgage if I Already Have One with Ex?
Yes, it is possible, but getting a new mortgage can be challenging if you already have one with an ex-partner, especially if you’re still paying off the joint mortgage.
Lenders look at your income and expenses to decide how much you can borrow. If you’re still on a mortgage with your ex, your expenses might be high taking into account that mortgage payment and property costs, which could reduce the amount you can borrow.
The Impact Of An Existing Joint Mortgage
If you hold a joint mortgage with your ex even after divorce, you must continue payments until the loan is settled, refinanced, or another arrangement has been made that you are no longer on the mortgage. This could be a hindrance if you want a new mortgage.
The most significant impact will be on affordability assessments. When applying for a new mortgage, lenders will examine your existing liabilities, including joint mortgages, which can impact the amount you can borrow again.
Your credit score will also influence the acceptance of your new mortgage application. For joint mortgages, missed payments will appear on your credit reports even if your partner missed the payment.
Moreover, the existing mortgage will also contribute towards your debt-to-income ratio, an essential metric lenders use to assess your affordability. A large outstanding joint mortgage can significantly lower your borrowing power.
So, if you’re looking to get a new mortgage, the first step is to understand the implications of the existing mortgage and find a solution for any problems that might crop up.
How To Improve Your Chances of Approval While Applying For A New Mortgage
Getting a new mortgage while bearing the brunt of an existing one needs careful preparation to improve the chances of approval.
Here are some steps you can follow to ensure a smooth processing of your application.
1. Perform A Financial Evaluation
First, perform a thorough financial evaluation of your income and outgoings, including calculating your debt-to-income (DTI) ratio.
Lenders usually ask for a DTI ratio of 40% or less, so ensure your joint mortgage isn’t taking your score beyond that threshold. Certain lenders will disregard mortgages from the debt to income ratio, an experienced mortgage broker can help you with this.
Also, create a detailed monthly budget of your current income and expenses to understand how much you can repay monthly for the new mortgage.
2. Cross-check Your Credit Report
Your credit report will play a vital role in your mortgage application, so check it thoroughly before applying to ensure the information is up-to-date. If errors or discrepancies exist, ask for them to be corrected immediately.
3. Talk With Your Ex And Your Lender
If an existing joint mortgage is proving to be a roadblock towards getting a new one, discuss the matter with your ex and your lender for the joint mortgage.
You may be able to transfer the mortgage to your ex completely, or they might be amenable to selling the property and settling the loan.
Understanding Your Mortgage Options
After you’ve taken the above steps to ensure that your new mortgage application goes through smoothly, it’s time to look at your options regarding the new mortgage.
As always, there are multiple choices here, and you must decide on the most suitable option.
1. Holding The Old Mortgage And Getting A New One
Yes, you can get a new mortgage even if you have one with your ex, provided you can afford it. Lenders usually use affordability calculators to make this decision.
Mortgage Affordability Calculator
2. Port The Existing Mortgage
If your lender allows, you can also port the existing mortgage deal to the new property at the same terms and interest rates. This can be useful if you have favourable terms for your existing mortgage.
Keep in mind that this process will require your ex’s consent if they are also on the joint mortgage, and you’ll still need to go through the affordability assessment. Some lenders allow you to port the mortgage and remove a party from the loan remove subject to you meeting the criteria.
3. Using A Guarantor Or JBSP Mortgage
Suppose you can’t afford the new mortgage on your own, you can go for a guarantor mortgage, where a family member agrees to cover the payments if you cannot. Realistically, guarantor mortgage are very rare.
This can help your application but might put the guarantor at risk if you miss payments.
You can also opt for a Joint Borrower, Sole Proprietor (JBSP) mortgage, where you can include another person’s (suppose, father or mother) income in the application without giving them property ownership.
This allows you to increase your borrowing capacity.
4. Use Specialist Lenders
If none of the above options apply to you, you can approach specialist lenders who deal with complex mortgage cases.
These lenders often have more lenient lending criteria but may charge higher rates and fees, so keep that in mind before opting for one. An example of this may be higher affordability calculations.
Submit this quick form and connect with the mortgage advisors we work with, who can help you find the right solution.
Frequently Asked Questions (FAQs)
1. Can my ex’s financial behaviour affect my ability to get a mortgage?
Yes, it can. Since both of you are jointly responsible for the joint mortgage, even if your ex misses a payment, this can negatively impact your credit scores. So, keeping your credit records current and communicating with your ex regarding payments are essential.
2. Can I remove my name from the joint mortgage without selling the property?
Yes, you can do this through an equity transfer process, but your ex must be able to afford the mortgage alone and will have to undergo another affordability assessment. If this is approved, your name can be removed from the mortgage.
Your home may be repossessed if you do not keep up repayments on your mortgage.
All content is written by qualified mortgage advisors to provide current, reliable and accurate mortgage information. The information on this website is not specific for each individual reader and therefore does not constitute financial advice.
Our goal is simple – to provide most up-to-date and accurate mortgage information to make your mortgage journey as stress-free as possible. Have a question? Fill up the quick form and one of our mortgage advisor will connect with you.
