We get many enquiries of those who want to know what to do with the mortgages or investment properties when separation or divorce occurs. There are a few options, which include:
If you choose to sell your share to your ex-spouse, they will have to refinance the home loan to buy out your share of the property and to remove your name from the home loan. You’ll also want to make sure to have your name taken off the property title after the divorce.
Should you sell your share of the property to your ex-spouse, you will be eligible for capital gains tax (CGT) rollover relief. This means that you won’t have to pay CGT on the share you sell to your ex-spouse, because the spouse who receives the property is assumed to receive the capital gain or loss on the property should they decide to sell in the future.
You could overcome these obstacles or difficulties by applying for a home loan to pay out a settlement for divorce, an agreement for separation or settling a property. However, a bank will assess any of these as either an acquisition or a refinance. Because of this, you will find that the lending institution will evaluate the loan application differently by applying a variety of lending conditions, which could include:
If you have any questions and need to talk it through, don’t hesitate contact us.
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