Keep the house or sell after separation? Start with the numbers

Compare both options using the same property estimate and the income and expenses you expect after separation. Keep the sale proceeds separate from the amount you personally receive under the property agreement.

This hypothetical example uses a $900k property value, a $380k mortgage, a separately agreed $270k payout and estimated selling costs of $25k. The payout is an assumption, not a 50/50 split or an estimate of anyone's legal entitlement.

Use the existing property buyout guide and calculator for your own figures, then compare repayments with the mortgage repayment calculator.

The new loan can be much larger than the old mortgage once the amount going to your ex-partner is added. The lender will check the whole loan using the income, debts and living costs you will have after separation.

Include child support paid, any income the lender may use, dependants, childcare, school costs, card limits and every joint debt that is still open.

If the budget is too tight, you may need to discuss a different payout, what happens to the property or a longer timeframe. Those are legal and personal decisions. Checking the budget first helps you see the pressure before committing to an agreement.

Use the guide to calculate a property buyout when you need the payout and new loan worked through in more detail.

Start with the expected sale price and subtract the mortgage payout and selling costs. The remaining amount still has to be divided under the property agreement. The agreement may also deal with other assets and debts.

Then add the next step. Renting may need bond, advance rent and moving costs. Buying again needs a deposit, purchase costs, an acceptable property and another loan application.

Timing can change the answer as much as the sale price. If the next purchase has to settle before the former home sells, the cash may not be available yet. If the sale happens first, temporary rent and moving twice may need to be included.

Compare the cash left after the move with the monthly cost of the next home. Selling may reduce the mortgage pressure, but the next housing costs still need to fit your budget.

For a single-parent purchase, the existing home loan guide for single mothers explains the deposit, income, child support and government-scheme questions.

If you are also considering moving out and renting the former home to tenants, the existing sell or keep it as a rental guide covers vacancies, repairs and the cost of holding both properties. Get legal and tax advice about the separation before relying on that option.

For the same loan amount, a higher bank valuation reduces the loan as a share of the home's value. But if your property agreement also uses a higher value, the agreed payout may increase, which can mean a larger loan.

A lower value can reduce the payout but make the new loan harder. That is why I test a reasonable range before the agreement becomes hard to change. The value used for the separation and the value accepted by the lender may not be the same.

I would also test a slightly higher repayment and one unexpected home cost. You do not need to predict every future bill. You need to know whether keeping the home still works if the first estimate is a little off.

About this information: General information only. It is not legal, tax, financial or credit advice. The property agreement, costs, valuation and loan assessment depend on the complete circumstances.

Client examples are based on real situations. Names and identifying details have been changed.