Taking one name off a tracker mortgage

[bart]

I own a two bed apt ( bought in 20006 and now in negative equity) with my former partner. 3 years ago after we split up I tried to get ICS to transfer the mortgage into my sole name but they refused. I have been making the mortgage payments for the last 3 years and have an agreement with my ex to take their name off the mortgage at the earliest possible time. The mortgage is a tracker with about 30 yrs to go. I am keen to get the property into my own name and am able to meet the current repayments on my own - what is the best way to approach the bank in this situation? It is important at this stage that we can both get on with our lives without this hanging over us

 

[Brendan Burgess]

Hi Bart

From the bank's point of view, they have, in effect, a guarantor, so why should they reduce their security. If you don't pay the mortgage, then they will come after her.

So I don't think that you will get the bank to agree unless you offer them something in exchange. For example, you will pay a lump-sum off the capital or convert to a SVR mortgage. However, I don't think it's worth that.

This affects her more than it affects you, as she has a liability for something which she gets no benefit from.

If you are happy that you will be able to pay the loan over time, then she need never get involved again. Go to your solicitor and draw up a legally binding agreement with her. So when the house returns to positive equity, she will have no claim on it.

Maybe at some later stage, the banks may change their policy, but I doubt it.

Brendan

 

[bart]

Thanks Brendan,

The reply was pretty much as I expected I suppose. What would happen therefore if she was to ever look for a mortgage on her own or with a partner? Is it the case that she will be unable to do so unless her name is off the mortgage with the bank?

Furthermore, if I were to get married and live in my wife's home while renting out the apartment I presume the bank would have to be informed.

I accept the negative equity situation and the fact that I have to repay the mortgage on the apartment - I just wonder at what stage does it become worth it for me to give something to the bank (accepting a SVR for example) so as to ensure that there are not too many loose ends?

Bart