How can I raise the money to buy out my husband?

Posted on 7 September 2007

I am trying to get a mortgage to buy out my husband as we have now separated. At present I earn £45,828 as a headteacher. Our house has been valued at £375,000.  We have an interest only mortgage of 120,000 and I would have to raise 130,000 to buy him out which means a mortgage of £250,000. My daughter would stay with me and pay rent. Is there any way of raising the money? I will be 50 in October.

It always helps to use a broker for this sort of thing as you need someone actually speaking to the underwriters for you.  Your age should not be an issue; many lenders lend until 70 now, but you will need to work out how to structure your repayments so that they monthly cost is not too high.  You could consider putting part of the loan on interest only.  Unfortunately Mortgage Express and West Bromwich have just stopped offering rent-a-room schemes, and in any case I would have been uncomfortable accepting rental income from your daughter as an income source, but thankfully I don't think you need that income taken into account.  Your strength is that you are only borrowing 66% loan-to-value ratio.  For a £250,000 loan you are asking for 5.4 x income. Lenders that use traditional income multiples don't go that high.  However, ones that use the affordability method sometimes can.  If you have a good credit score so I would try Alliance and Leicester, Standard Life, Halifax, Abbey, C&G, Lloyds, Saffron, Woolwich.  Failing that, your daughter could be your guarantor. Come back if you need to go down that route.

A broker's job is not only to find you the right mortgage product, it's also to negotiate terms outside of standard criteria for you; so do call 0800 358 5560 or apply online of you want Charcol to give you a hand.

Katie

Category: Interest only vs repayment, Lower mortgage payments, Mortgages in retirement, Remortgaging, Valuations, Freehold, leases & unusual property

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