Buy someone out of a mortgage australia

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awesome
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Joined: Thu Mar 12, 2015 5:56 pm

Buy someone out of a mortgage australia

Post by awesome »

Hi, my partner and I agreed to separate and both of us are now happier. There is no bad blood between us and we are ready to move on with our lives. We did have a home loan here in Australia though but I would like to buy her out of the mortgage. Any way I can change the loan so it's just me on the title?

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Otto Dargan
Mortgage Specialist
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Location: Sydney, Australia
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Re: Buy someone out of a mortgage australia

Post by Otto Dargan »

Hello awesome. Welcome to the forums.

You can choose to buy out your ex-partner’s share of the property, they decide to buy out your share of the property or sell the property and then share the sale proceeds, which is one of the easiest ways to divide assets after a separation.

However, you aren't allowed to just change the loan terms and remove your ex-partner's name on the title. In Australia, you're not allowed to take over the mortgage of another person or remove someone from a mortgage agreement.

You’ll need to refinance your home loan to a new loan that's solely in your name but your partner must agree and sign a transfer form. Additionally, you'll need to meet standard bank lending policy without your partner.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

awesome
Posts: 11
Joined: Thu Mar 12, 2015 5:56 pm

Re: Buy someone out of a mortgage australia

Post by awesome »

Thanks Otto. That's okay, I had been considering to refinance to another bank anyway. You seem like a standup guy. I will call your office to see how you guys can help me with this :)

rage
Posts: 10
Joined: Thu Mar 12, 2015 5:36 pm

Re: Buy someone out of a mortgage australia

Post by rage »

I've been thinking - will I be able to get half of the equity or half of the total value of the house if I want my ex to buy me out? What about paying stamp duty or capital gains tax, since I'm selling it? Will I pay or will my ex?

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Otto Dargan
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Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
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Re: Buy someone out of a mortgage australia

Post by Otto Dargan »

Hi rage,

Based on what we've seen it's typically the equity that gets split, but it's never that simple! It's best if you discuss this with your lawyer because it's a complex issue and you may possibly also need to speak with an accountant to get specific information for your circumstances.

Regarding stamp duty though, it's waived in most states for a transfer of ownership as part of a divorce settlement. Also, you won't likely have to pay any Capital Gains Tax (CGT) if the property was your home.

However, if it's an investment property then whoever keeps the property may be liable for CGT in the future as if they had owned the property themselves the entire time.

You can check out our website for more information. You can also call us on 1300 889 743 or enquire online if you need financial assistance to restructure the ownership of your properties.

Cheers,
Otto
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

rage
Posts: 10
Joined: Thu Mar 12, 2015 5:36 pm

Re: Buy someone out of a mortgage australia

Post by rage »

It was our home so I guess no capital gains tax. Will have a look at your website to find out more about all this.

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