The Strategic Context
In 2025, the "buyout" has become a battleground. With property prices high and serviceability buffers strict, separating couples face the "Mortgage Prisoner" scenario: unable to refinance a home they can physically afford.
Why this matters now:
- Interest Rates: Refinancing solo is harder than ever.
- Serviceability: Moving from dual to single income fails standard assessments.
Borrowing Power: The "Prisoner" Gap
Deep Dive: The Technical Traps
Avoid the common pitfalls that destroy deals and credit scores.
1. Liability
The "Spite Default"
Both parties are 100% liable. If one stops paying, both credit scores tank.
Tip: Demand perfect repayment history during separation.
2. Serviceability
The Income Gap
Standard lenders often cut Child Support income by 20-50%.
Tip: Use lenders who accept 100% of Child Support.
3. Cash Out
Policy Blocks
"Cash out for personal use" is often declined. Divorce payout is different.
Tip: A Court Order or BFA is mandatory evidence.
The Broker's Roadmap
Pre-Divorce Credit Check
Run credit files immediately. Ensure no rogue debts are being accrued by the ex-partner.
Target "Flexible" Lenders
Filter for non-banks using "actual" repayments on outgoing debts, not sensitized buffers.
Wait for the Order
Do not finalize loan structure without a BFA. It is essential for stamp duty exemptions and cash-out approval.
Impact of Lender Policy
Master the Niche
Get the actionable tools you need to help clients navigate separation with certainty.