Couples who are currently going through divorce are feeling the full-force of the continuing rise of the interest rate in the UK. Divorce settlements are becoming more difficult to reach as spouses argue over who will keep the marital home and the low mortgage that comes with it. Family Law Solicitors have noticed the added stress and complications the current economic climate is causing for separating couples.
How does the mortgage rates crisis affect divorce settlements?
The rising mortgage rates are causing havoc for home owners across the country – not least, divorcing couples who are looking to split their assets and marital home. On the one hand, a couple’s mortgage may currently be fixed as low as 1%. It could be possible for the party who stays in the family home to keep this low interest rate on the existing mortgage amount, and only have to succumb to the sky rocketing interest rates on any additional borrowing (which would likely be taken out to buy out their ex-partner). For couples with several years left on their current fixed mortgage deal, this is throwing a spanner in the works when it comes to reaching divorce settlements. Both spouses are now more keen to keep the marital home with this advantage in place.
On the flip side, for couple’s whose current mortgage deals are coming to an end, affordability is causing a real concern. The increased interest rates are having ramifications for divorcing families who may have wished for the children to stay in the family home with one of their parents. For many families, this is becoming unachievable and unaffordable. Statistics show that at the time of publishing this blog, the average two-year fixed deal is now 6.6 per cent, while a five-year fix is 6.17 per cent. A little over two weeks ago, the average fixed deal sat at 6.01 per cent. This means that someone with a mortgage loan of £165,000 on a 20-year-term would pay an extra £49 a month in interest payments. This works out at £11,760 over the lifetime of the mortgage. (Source: Moneyfacts).
How can Ten Legal help me navigate divorce amidst the current mortgage rates crisis?
While we can’t wave a magic wand and reduce the interest rates the Bank of England have set, we are here to offer support and guidance through these uncertain times. Should you choose to instruct TEN Legal to assist you with the divorce process, your dedicated Family Law Solicitor will offer expert advise on how best to handle any negotiations that may be ongoing with your ex-partner, enabling you to come to a divorce settlement as quickly and efficiently as possible.
How do I get in touch?
The divorce process can be difficult to navigate, but you don’t have to do it alone. At TEN Legal, we’re here to help you through your divorce with your best interest in mind every step of the way.
If you would like impartial, expert advice regarding your divorce or any other family law issues, please get in touch with our friendly team. We will help and guide you through the divorce process to ensure the best possible outcome.