Western Mail Property Doctor Column #20
By admin
Issued on behalf of Emyr Pierce Solicitors
I own a property jointly with my boyfriend and we are considering separating. What should we do with the house we are currently buying in joint names?
The first thing you should do is speak to your building society to establish what the options are for one of you to take over the mortgage in sole name. If one of you is prepared to leave the home you currently jointly own, then you both need to be sure that the partner who is going to keep the property can afford to do so. The important thing to be aware of here is the dreaded early repayment penalty that the majority of fixed rate and discounted mortgage products carry. I always advise clients to make sure, in the event of a relationship break-up, that the transfer of the mortgage will not trigger an early repayment penalty. I know separation is the last thing on young lovers’ minds when they’re looking to buy their first home together, but you should always ask your lender right at the outset about this question of early repayment penalties, and if they say they won’t charge one – get it in writing. Of course, if neither of you can afford to take over the mortgage on your own then the obvious consequence of the separation is the need to sell the home and, in the majority of cases, that will trigger an early repayment penalty. If financially you are comfortable for one partner to take over the mortgage you will need to agree the terms of the separation. The partner relinquishing the property – and the mortgage – might well agree on a cash payment worth half the equity. That means, of course, that the partner hanging onto the house – and taking over full responsibility for the mortgage repayments – also has to find extra money to settle up with the outgoing partner. That may mean the partner who stays with the property having to remortgage to find that extra money which, in turn, can mean incurring that early repayment penalty. If the building society agrees on the transfer from two to one then the solicitors need to be instructed to prepare the documentation. There could also be a Stamp Duty issue here. If you have a £350,000 house with a £200,000 mortgage mortgage and the outgoing partner is to receive £50,000 as share of the equity, then this would incur Stamp Duty on the mortgage transfer. Clearly, the key to any couple planning to buy jointly is to think through all possible future outcomes – separation can be a costly business!
My next door neighbour doesn’t look after his property and is constantly discarding rubbish in his front garden which is an absolute eyesore. Is there anything I can do to make him clear it up?
One of the most important things to consider when buying a house is to ensure that the properties on either side are owner-occupied. It’s one of the standard questions that should be asked on behalf anyone looking to buy a property. If the properties on either side are not owner-occupied there is a far greater chance that the people living in them will neither respect their homes – or yours. You can, of course, be very unlucky and end up with appalling neighbours who just don’t care, whether they are owners or not. But if you are buying a house and spending lots of money on it then you really need to ensure the houses on either side are also well-maintained and the people in them have respect for their neighbours. The local council is really your only hope in a situation like yours. If the mountain of rubbish next door constitutes a health hazard with rats nesting in an old fridge freezer, then there’s a good chance the council will act. If it’s just an eyesore problem then that’s not so easy to get any action at all..
