If you are getting divorced or dissolving a civil partnership, you will need to split your assets fairly with your former partner. As it has such a high value, one of the biggest and most complicated decisions you will need to make is how best to divide the family home when you divorce.
The first thing to remember is you have matrimonial rights.
Matrimonial rights are statutory rights designed to protect people in a marriage in the event they divorce. This includes protecting your interest in the family home you shared with your former spouse or partner.
Whether you co-owned the property, or the property was owned by one party, if you lived in it together, your home will be recognised as a joint asset. This not only means that the value of the family home needs to be divided fairly but also that neither party can be forced to leave the property if the couple separates.
If your mortgage is in your ex-partner’s name and you are worried that they might sell the house, you can apply for a ‘Notice of Home Rights’ from the Land Registry. Under matrimonial rights, this will prevent your former partner from selling the property without your consent.
However, today it is much more likely that the house will have been bought with a joint mortgage and we shall look at your options if you have a joint mortgage later in this blog.
What are the options when it comes to dividing the family home in a divorce?
When you divorce or dissolve a civil partnership, you have several options as to how you can divide the family home:
- You can sell the property and split the money so both parties have at least a deposit for a new property.
- You can agree to buy your partner out of the property or for your partner to buy you out of the property.
- You can transfer part of the value of the property from one partner to the other as part of the financial settlement. However, the transferring partner will maintain a share of their ownership so that they receive an agreed percentage of its selling price when it’s eventually sold.
- You can keep the ownership as it is so one partner can continue to live there, possibly with your children if they are under 18.
What should you do if you have a joint mortgage?
In England and Wales and you have a joint mortgage, you will need to talk to your mortgage provider about who will continue to pay the mortgage. The advantages of doing this as quickly as possible are:
- The person who stays in the house will no longer have any financial reliance on their ex-partner.
- The person whose name is taken off the mortgage should be able to borrow more and more easily to buy themselves another property than they would be if their name was still on the joint mortgage.
- The parties’ credit files will no longer be linked together which means future applications for credit will not be influenced by your ex-partner’s credit score.
When you split a joint mortgage there are, generally speaking, two options to consider, a Mesher or a Martin order.
The main difference between a Mesher and Martin order is whether children are involved. If there are children, you would usually use a Mesher order. If there are no children involved, you’d usually use a Martin order. However, there are other considerations.
What is a Mesher order?
A Mesher order is a court order that prevents the sale of a home until after a specific date agreed by the couple with the joint mortgage. Both names remain on the mortgage until this date. As the property remains joint and in both partners’ names, both parties must contribute towards the repayments and the money from the sale with be split between them when the property is sold.
The reason a Mesher order is the preferred option when there are children involved is it minimises the potential disruption to their lives by enabling them to stay in their home at least until they finish school or move out.
If it is preferable, the date can be overwritten but ‘trigger event’ such as:
- The ex-partner staying in the home begins to cohabit with a new partner or remarries
- The youngest child turns 18
- The youngest child either leaves secondary education or higher education
What is a Martin order?
A Martin order is based on the guidance set out in section 24(1)(b) of the Matrimonial Causes Act 1973. It allows one party in a divorcing couple to occupy the marital home either for life or until remarriage.
A Martin order is typically granted when the court determines the party not staying in the family home has the means to support themselves without needing access to the capital that would be released by the sale of the marital home.
If this blog has raised any questions regarding the best way to divide the family home in a divorce or you would like to discuss any other legal issue regarding a divorce or the dissolution of a civil partnership, please contact us today to arrange a meeting with one of our experienced family law barristers.