Divorce and Your Mortgage

The key points at a glance

If you own a home together and decide to split up, it's important to make clear agreements. Will one of you take over the mortgage, or will you sell the house? If one of you decides to stay in the home, that person will need to buy the other out. This means one partner takes over the mortgage and bears all the costs alone.

1. Buying out your partner

After a divorce, you may decide to buy out your ex-partner, for example if you want to keep the home and the other partner wants to sell. Before the divorce, the current mortgage was most likely paid from both salaries.

After the split, all costs fall on the salary of the partner who remains the owner of the home. It's important to determine whether you have enough income to pay the new mortgage on your own. The provider decides whether you can afford the costs alone and whether the mortgage can therefore be put in one name.

If you are required to pay alimony to your ex-partner, this can affect the size of your new mortgage. If you are taking over a mortgage due to a divorce, it's a good idea to get help from an adviser.

It's also important to determine what your current home is worth. There are several ways to do this:

• Hire a valuer or estate agent for a valuation report (taxatierapport); you can request a quote in advance
• Get a rough estimate from an estate agent, which is often free of charge
• Look up recent sale prices of comparable homes in the area; these can be purchased from the Land Registry (kadaster)
• Look up the WOZ value (official property valuation for tax purposes) online at the WOZ-waardeloket; keep in mind this is an indication only

2. Calculating the mortgage takeover

You can increase your mortgage to take over the share from your ex-partner. However, you need to be able to afford the extra costs. Calculate your mortgage after a divorce to see whether you are able to take over your ex-partner's share of the mortgage.

The current property value shows whether there is positive equity (overwaarde) or negative equity (onderwaarde) in the home. If there is positive equity, the person taking over the mortgage must buy out the other. In the case of negative equity, it works the other way around.

An adviser can help you calculate what taking over the mortgage involves, taking into account your income, the new mortgage, and the costs of buying out your partner.

3. Buying out your partner in instalments

Can't buy out your partner in one go? Paying in instalments is also an option. You'll need to make good agreements about this, and you obviously need your ex-partner's approval. It can be helpful to bring in a mediator for this.

4. Deed of partition

It's important that a deed of partition (akte van verdeling) is drawn up by a notary when you take over a mortgage. This deed must confirm that the home and the mortgage are in your name. Without it, your ex-partner remains liable for paying the mortgage and interest after the break-up or divorce. It is therefore very important to have the mortgage deed updated by a notary.

Drawing up a deed of partition involves notary fees, which can vary from one notary to another. You can request quotes from several offices.

Who pays the costs is something you decide together. Usually the costs are split between the ex-partners.

5. Taking over the mortgage without a buyout

Is it possible to take over a mortgage without buying out your partner? In practice, we often see that this is not feasible. The departing partner would not share in any profit from potential positive equity in the home.

One option is for the partners to remain joint owners of the property. This can work when it's financially not possible to put the mortgage in one name. It's important to make clear agreements about this. A mediator or adviser can help with that.