According to government statistics, the over 50s age group is responsible for the biggest increase in the divorce rate, with around 60,000 people filing for divorce in 2013; a rise of 11 percent over the last decade.
With almost one in three selling their marital home as part of the divorce process, many couples are now finding that they simply don’t have the funds available to be able to buy their ex-spouse’s share of the house.
Currently, couples going through a divorce are usually advised to continue paying the mortgage on the family home as normal, particularly if the mortgage is due to be paid off in the near future.
The Daily Telegraph reports however that to help individuals in these circumstances, a number of lenders are considering the possibility of introducing a new “divorce mortgage”. This new mortgage would allow one half of a divorcing couple to borrow enough money to buy out their other half, effectively enabling them to stay in their house.
It is thought that the new mortgage would prove particularly useful in cases where young children are resident in the family home and parents are concerned about the effect that having to move house, as well as their parents’ divorce would have on them.
Having successfully applied for the so-called divorce mortgage, the divorcee would receive a lump sum specifically for the purpose of buying out their partner from the house. In addition to this lump sum, the lender would also receive an additional amount of money which would be deposited in a savings account to be used for the sole purpose of paying off the interest on the loan.
At the end of the specified loan period, the divorcee would be given the option of either selling the property in its entirety and paying back the lender, or taking on the mortgage themselves and remaining in the property for as long as they wish.