How to buy a partner out from a home loan?

Any general questions you might have in regards to loans and finance.
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Otto Dargan
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Re: How to buy a partner out from a home loan?

Post by Otto Dargan »

Hi Sanyuktaa and welcome to the forum.

Your partner can buy you out from your home loan but he'll need to prove that he can qualify for the mortgage on his own. This means that he must meet standard bank policy without you. And yes, he’ll need to refinance the loan to a new loan that's solely in his name.

If he can prove that, then he may be able to:
  • Refinance his home loan and extend his mortgage to 95% of the property value.
  • Increase his home loan to pay out a divorce settlement, if needed.
  • He may have to pay Lenders Mortgage Insurance (LMI) if he’s borrowing or refinancing over 80% of the property value.
Please note that you must agree and sign a transfer form to proceed with the new application.

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

User avatar
Otto Dargan
Mortgage Specialist
Posts: 7730
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
Contact:

Re: How to buy a partner out from a home loan?

Post by Otto Dargan »

Hi Sanyuktaa,

As with any mortgage application, if the bank valuation comes in low, then the loan may be declined. This means that you may be unable to complete your divorce settlement and successfully divide the property.

Since a bank valuation is out of your control, it can be a good idea to get an experienced mortgage broker to order multiple valuations before submitting a full application. This way, you can go with the lender that has the most favourable valuation.

Earlier, the only way to order valuations with multiple lenders was to put in multiple applications at the one time. If you were to do so nowadays, you’d most likely fail credit scoring for all the lenders that you applied with due to the high number of enquiries on your credit file and your loan application would ultimately be declined.

Our mortgage brokers are experts in divorce mortgages and can help you get approved at a great interest rate. Please call us on 1300 889 743 or enquire online to find out how we can help you.

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

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