Following a divorce or separation, the spouses continue to be dependent together on the debts contracted during their union, including a mortgage. To dissociate yourself from this bank loan, buying back credit to pay the balance is an avenue to explore. How does this system actually work? Answers.
Once united, a couple is solidary on all household debts relating to the education of children such as school fees, leisure costs and extra-curricular costs. This solidarity also concerns housing, in particular the payment of water and electricity bills, the payment of rent, insurance and condominium fees. In addition, it relates to everyday life expenses such as taxes and consumer or real estate loans. The solidarity of the spouses means that one of the spouses is entitled to contract a household debt without obtaining the consent of his partner.
On the other hand, the two spouses will be bound to this debt and must settle it together even if the other spouse has not agreed to its subscription. In this context, the creditor is fully entitled to claim reimbursement of the sum contracted from the other spouse who has not given his consent. This rule is valid within the framework of a marriage carried out under the regime of the community. On the other hand, if it is a question of the separation of property regime, the bank can only seize the property and income of the spouse who contracted the household debt.
This solidarity of the spouses can become a problem in the context of a mortgage. Because even if the couple separates, the bank continues to give itself the right to claim reimbursement from both spouses until the end of the credit. To avoid such a situation, it is imperative to carry out a separation on the loan. One of the solutions in this context is to buy out the spouse's share. This practice called "repurchase of balance" allows one of the spouses to keep the property for him. However, he must pay his ex-partner compensation to compensate for the loss of his house. This is called the balance.
To know the amount of this one, it is enough to carry out a simulation. Say the house is worth $250,000. The remainder to be paid on the mortgage is 70,000 euros. The cash payment then amounts to 90,000 euros, i.e. (250,000 / 2) – (70,000 / 2). Whoever buys it must have a total of 160,000 euros, i.e. 90,000 euros + 70,000 euros.
The balancing payment can be financed by own funds. However, it is usually paid through a bank loan. The spouse can opt for a repurchase of credit in order to settle the amount due to his ex-partner. The loan consolidation will include the cost of the balance and the other bank debts that the borrower wishes to consolidate. Thanks to the repurchase of credit, he manages to reduce the amount of his monthly payments as well as his debt ratio. He has sufficient financial capacity to pay the cash payment and acquire the property definitively.
Attention, before being able to obtain a repurchase of credit, it is still necessary to respect the criteria imposed by the bank. Not everyone is necessarily eligible for the offer, because access to it depends first on the creditworthiness of the borrower. Its debt ratio will be scrutinized and if it turns out that it is higher than 33%, the bank may oppose its refusal. It is also important to present an impeccable financial and banking history. People regularly subject to payment incidents are immediately rejected. Having a stable professional situation and fixed income is also a major criterion.
