# Property Adjustment Order



## danash (4 Feb 2009)

Let's just say hypothetically that I was separating  from my wife and was prepared to transfer the family home into her sole name under a separation agreement. Let's also assume she does not work and cannot fund a mortgage. What, hypothetically would be the position of the mortgage company in switching the asset to a single name on foot of the court order ?

Would they insist on a new mortgage product ? For example if the existing mortgage was a very good tracker rate and they only offered variable rates that were higher could they insist on the new mortgage ( with attached legal costs )

Would the court simply order the transfer of the asset and ask the mortgage company to take a guarantee on the existing mortgage ?

In effect can the judge tell the mortgage company what to do ?


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## Dreamerb (4 Feb 2009)

danash said:


> Let's just say hypothetically that I was separating  from my wife and was prepared to transfer the family home into her sole name under a separation agreement. Let's also assume she does not work and cannot fund a mortgage. What, hypothetically would be the position of the mortgage company in switching the asset to a single name on foot of the court order ?
> 
> Would they insist on a new mortgage product ? For example if the existing mortgage was a very good tracker rate and they only offered variable rates that were higher could they insist on the new mortgage ( with attached legal costs )
> 
> ...


If she doesn't work and can't fund a mortgage, then whose is the mortgage? 
The mortgage company doesn't switch the asset. You can change the deeds if you want - what the mortgage company is interested in is someone to pay it. 
Can the judge tell the mortgage company what to do? No. Why would they even be in court? It's a private matter. 

Hypothetically, you would need good legal and tax advice.


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## mf1 (5 Feb 2009)

Dreamerb has pretty much nailed it. But just to clarify - the property is not yours to do with as you wish - it is subject to a mortgage and the consent of the mortgagee would be necessary in the event of any change in position. 

Having spent most of yesterday morning with an increasingly irritated matrimonial client ( I told him I did not have a magic wand and the Court does not have a treasure chest to hand out money!) trying to explain the Court's role in all of this, I realised that he simply does not understand basic finance. Its a money in, money out situation.  The Court cannot order the mortgagee to do anything. 

mf


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## danash (5 Feb 2009)

I'm happy to leave the  mortgage as it is - my ex wife is fixated on 'getting the house in my name' ........ how does the property adjustment order reflect this situation ? 

I am seeking legal advice but just want to be prepared


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## mf1 (5 Feb 2009)

"how does the property adjustment order reflect this situation ? "

It does'nt. If the property is mortgage free, the Court can make an order. If the property is not mortgage free, the Court cannot make an order disenfranchising the mortgagee. 

mf


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## danash (5 Feb 2009)

mf1 said:


> "how does the property adjustment order reflect this situation ? "
> 
> It does'nt. If the property is mortgage free, the Court can make an order. If the property is not mortgage free, the Court cannot make an order disenfranchising the mortgagee.
> 
> mf


 

So what is the practical outcome - ? let me complicate the issue slightly. We have two properties and are taking one each in settlement. How practically would the court order the asset distribution -- in terms of names on deeds and prevailing mortgages.

This must happen every single day in the courts so I would have thought there is an accepted practice by the courts and the banks.


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## mf1 (5 Feb 2009)

Perhaps I'm not making myself clear. 

You cannot unilaterally decide what you are going to do with e.g. properties when there are other parties ( banks) involved. It is just not your decision. 

So you can decide what you would like all you like but the Courts won't make an order that makes no sense. 

"This must happen every single day in the courts so I would have thought there is an accepted practice by the courts and the banks. "

Ah yes! client gets increasingly irritated..........Now where did I put that magic wand! 

Most likely, if what you are proposing to do makes no sense and, if you cannot come up with a proposal that does make sense, and if you end up in Court, propert(y)ies will be sold , mortgages discharged and the proceeds split. 

That is what happens every single day in court!

mf


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## danash (6 Feb 2009)

mf1 - thank you for thr 'magic' advice.....we have a separation agreement that documents the split of the assets - I'm trying to see how the judge would reconcile the split with reference to proper provision while my name remains on the deeds/mortgage.


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## Vanilla (6 Feb 2009)

It is as simple as this- the court cannot order the bank to give you a preferential rate. So you have to make your own contract with the bank.


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## danash (6 Feb 2009)

Thanks - have to go for Plan B now with my ex wife......should be interesting.


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