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.

Use our 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.

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.

Allow for the cost of your next home too. 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.

I compare the cash left after selling with what you need for your next home. That shows whether you can cover the move and next housing costs when they fall due.

For a single-parent purchase, our 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, our 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.

If you can't agree on selling, or on who pays the mortgage in the meantime, ask your family lawyer. Our separation guide explains what the lender expects from both borrowers until the loan changes.

If the home was your main residence, a transfer under a court order or binding financial agreement usually rolls over for capital gains tax, and the main residence exemption may still apply. If you rent it out first, that can change. Your accountant should confirm.

A higher bank valuation can make the new loan easier, because the loan is smaller compared with 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 to see whether you could still afford the home 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.