Breaking Up with Your Mortgage: How to Buy Out a Partner and Take Over the Home

So, you've decided to part ways with your co-owner—whether it’s a relationship break-up, a business split, or maybe your sibling finally realised that living together forever wasn’t such a great idea after all. Now, there’s just the little matter of who gets the house, and how to sort out the mortgage without turning it into a full-blown episode of Law & Order.

Buying out a partner from a mortgage isn't as simple as just sending them a bank transfer and changing the name on the front door. You’ll need to go through a Transfer of Equity, consider the mortgage implications, and possibly deal with stamp duty. Sounds complicated? Don’t worry—here's the break down (minus the heartbreak).

Step 1: Work Out How Much You Need to Pay 

If you’re buying out your partner’s share, the first step is figuring out how much their share is worth. This is based on the current market value of the property, not what you originally paid for it.

Example:

• Your home is now worth £300,000

• Your mortgage balance is £200,000

• You own it 50/50, so their equity share is £50,000 (value minus outstanding mortgage)

• That’s the amount you’d need to pay them (or offset with other assets if you’re negotiating).

A property valuation (by an estate agent or surveyor) can help you get an accurate figure. If things are less than friendly, you might need a formal valuation agreed upon by both parties.

Step 2: Check if You Can Afford the Mortgage Solo 

Now comes the bit where the lender decides whether you can handle the mortgage alone. Since you’ll be taking on full responsibility, the bank will want to see that you have enough income to cover the repayments on your own.

Options if you don’t qualify alone:

• Bring in a new partner (common scenarios include transferring ownership to a new spouse; or where an inherited property is given to beneficiaries who are siblings or family members but have other financial ties/family members and won't ultimately reside in the home together, so one agrees to buy out another)

• Ask the lender for a longer mortgage term to reduce monthly payments

• Consider a joint borrower, sole proprietor mortgage (where someone helps with affordability but doesn’t own the property - like a parent who's willing to co-sign)

If the lender gives you the green light, you can move on to the legal side of things. If not, it might be time to get creative or rethink your options.

Step 3: The Legal Bit – Transfer of Equity 

The official process of removing your co-owner’s name from the mortgage and deeds is called a Transfer of Equity. This involves:

1. Getting a solicitor/conveyancer to handle the legal paperwork

2. Agreeing on the buyout terms

3. Updating the mortgage lender (if you’re keeping the current deal) or remortgaging (if you need a new deal)

4. Filing the TR1 form to transfer ownership with the Land Registry

5. Legal Fees: A Transfer of Equity usually costs £300-£500 in solicitor fees (more if things are complex).

Step 4: Do You Need to Pay Stamp Duty? 

Stamp Duty is the sneaky cost that can surprise buyers during a property transfer. In property transactions, the amount given in exchange for the purchase of property or land is known as the 'chargeable consideration'. Whether you owe anything on SDLT depends on how much you’re “paying” for your partner’s share i.e. the chargeable consideration in a typical buy-out is usually 50% of the equity plus 50% of the mortgage balance.

✅ You WON’T pay Stamp Duty if:

• The total value of the share you’re taking over (including mortgage debt) is below £125,000 (£300,000 if the person buying in is a first-time buyer).

• The transfer is due to divorce or separation under a court order.

  
  

❌ You MIGHT pay Stamp Duty if:

• The amount you’re taking on (including the mortgage) exceeds the Stamp Duty threshold.

• Example: If your ex’s share includes £150,000 of the mortgage, you could owe Stamp Duty on that amount.

Stamp Duty can get complicated, so it’s worth getting tax advice if you're unsure. The government Stamp Duty Calculator is a good place to start.

Step 5: Finalise the Process & Celebrate (or Sob into a Glass of Wine) 

Once the mortgage lender, solicitor, and Land Registry have updated everything, you’ll officially own the property alone. No more shared bills, joint responsibilities, or awkward negotiations over who gets the better bedroom/closet.

Get ready to redecorate, change the Wi-Fi password, stack the dishwasher your way and celebrate your new financial independence!

Top Tip: Can I Use a Lifetime ISA and Still Get My Bonus?

In short, so long as you you meet the government criteria to qualify for the LISA bonus (you're a first-time buyer, buying with a mortgage, buying a property under £450,000 etc), you can use your Lifetime ISA to buy out an ex partner's interest in a property. Find out more here.

Final Thoughts: Should You Remortgage or Stick with the Existing Loan?

If you’re buying out a partner, it's often a good idea to time this alongside your next remortgage date, as it lets you:

• Get a better interest rate

• Adjust the loan amount or term if needed

• Release extra funds for the buyout

However, if your current mortgage has a great rate, sticking with the existing deal and doing a Transfer of Equity might be the best option.

The Bottom Line

Buying out a partner from a mortgage can be a financially and emotionally draining process, but once it’s done, you’ll have full control over your home and future.