Sorting out the Money: Practical tips for Property and Mortgage
In our second blog focusing on sorting out the money we’re talking about property and mortgages. This builds on our blog last week talking about how it works.
There’s often a lot of talk amongst professionals about taking the emotion out of discussions and approaching negotiations in a business like manner. If you can do this then that’s great but this can often be challenging and especially so with regard to property. Discussions about property are often essentially about where will be your home and it’s hard not to be emotional about this. Your home is a safe place and your sanctuary where you can start to heal following this difficult time. It can also be challenging when you’re talking about selling the family home because you may feel that this will impact on your children as it is their home too.
Mediation helps you to look at different options and what they will look like in terms of money so you can see whether they are affordable or not. It also enables you to understand what compromises might need to be made to make a particular option achievable so that you can assess whether this is workable or not. For example, you may want to remain in your family home but if this involves working full time instead of your part time hours would you still want to do this?
Whether you can afford to stay in the family home, or whether you can afford the property you particularly want will usually depend on how much capital is available and what mortgage capacity you have. Your mortgage capacity is usually dependent on your earnings and what level of deposit you will have but maintenance can sometimes be a factor.
It’s tempting with property to want to throw everything into the option you most prefer but it’s important to remember that both of you need to be housed and in an ideal world you would both be housed in a property where the children can stay overnight with both of you. Again mediation helps you to explore different options to see which options are affordable and which enable you both to have your children to stay with you.
Sometimes it can be helpful to think of other options with regard to property to help stretch your resources further. These might include other options like shared ownership properties where you buy a percentage of the property and pay rent on the other part. If you’re over 55 then this may mean you can access reduced housing prices. The government’s Help to Buy scheme may assist too. You can also consider looking at property slightly further out than your preferred location or compromising your ideal requirements. This doesn’t always mean you’ll have to do that but information is empowering. You can only decide to choose between a smaller property in your ideal location, or your ideal property 10 minutes down the road if you understand these options and what’s out there.
Talking to a trained financial professional can also be hugely helpful. You may feel that you won’t be able to get a mortgage because your situation is not straight forward but a financial expert specializing in this area will be able to help you look properly at the best options for you.
By working through options in mediation you can also put a plan together for the sale and purchase of any properties. You can look at how your moving costs (including stamp duty payable when you purchase a new property over a certain amount) will be paid and talk about practical things like who will retain what furniture, and how you can achieve the best possible price for any property you’re selling. You can also look at how long you might hold out for a particular price and at what point you would consider reducing the selling price of a property.
Family mediation also enables you to understand each other’s priorities so that you can approach finding a resolution with a clear understanding of what each other are trying to achieve. If you have been wondering why the other person rejects your offers mapped out around them staying in the house then it may be they’re contemplating a fresh start in a new property. It might not be the numbers that are an issue.
An important part of looking at property is ensuring that wherever you live you can make ends meet because you both need to be able to pay your bills. Mediation enables you to map this out and to understand the impact of each option on both of you. This is an essential part of the resolution process because you both need to feel as financially secure as possible going forwards.
We will be talking more about this and other financial issues in our series of downloadable webinars which will be coming in the spring. To stay up to date with when they’re likely to be launched join our free mailing list. We also have a separate mailing list for professionals working with separating couples. This will include sharing the webinars so you can share them with any of your clients who may benefit. It also includes details of our forthcoming training workshops and networking events.
To watch the Facebook Live talking about this blog in more depth have a look at the video below: