First time buyer status following divorce

K

kasko

Registered User
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Hi all,

I have a question in regards to first time buyer status following divorce. We bought a property, and when we "verbally separated" my ex moved out, and we sent a letter to the Revenue stating that I will continue living in the house and therefore I have been receiving tax relief.

Four years on, she wants to move back in for whatever reason and I would move out and try and secure another mortgage for myself. This time we will also go for a divorce and state that she will be living in the house and I will move out. Now when I go and try to get another mortgage will i still qualify for the first time buyer status?

Thanks
 
When you say we bought a property - did the two of you go on the deeds and loan for the house?

If you did then your 'first time' buyer is used up.
 
Not exactly,
If you give up your share of the haouse to her, you will return to "First time buyer" status.
 
[broken link removed]

A First Time Buyer as defined by Section 92B, Stamp Duties Consolidation Act, 1999, is a person, (or, where there is more than one buyer, each of such persons):

  • who has not on any previous occasion, either individually or jointly, purchased or built on his/her own behalf a house (in Ireland or abroad) and
  • where the property purchased is occupied by the purchaser, or a person on his behalf, as his/her only or principal place of residence and
  • where no rent, other than rent under the rent-a-room-scheme, is derived from the property for five years after the date of the current purchase.
Special situations for FTB relief -
a) The trustees of a trust (to which section 189A of the Taxes Consolidation Act 1997 applies), whose trust funds are raised by public subscriptions for the benefit of permanently incapacitated persons, in respect of the first house(s) bought after the establishment of the trust, for occupation by the beneficiary or if more than one, each of the beneficiaries.


b) A spouse to a marriage the subject of a decree of judicial separation, a deed of separation, a decree of divorce or a decree of nullity in the case of the first acquisition of a house by the spouse following the separation or divorce provided that the spouse had, in relation to the former marital home,

  • left that home;
  • not retained an interest in that home;
  • Immediately prior to the date of the decree of deed of separation is not beneficially entitled to an interest in a house other than the marital home. At the date of the decree or deed of separation, the separated/former spouse must also be in occupation of the home which was occupied by both spouses prior to the separation or dissolution of marriage
Click to expand...

That would seem to provide a mechanism for the OP to regain FTB status provided they retain no interest in the home upon divorce. However, there is some tricky language particularly in the last paragraph that you may need to be wary of. You are both not going to be residing in the house. I am assuming you only ever "verbally" separated, and did not obtain a decree or deed of separation. Legal advice is appropriate.
 
Yes, we bought the property together. "Not retained an interest in that home", what does this actually mean? Does this mean taking my name off the deeds, but still having liability as debtor? The house in in negative equity and I do not think that the bank would allow my ex taking this mortgage in her own name.

As I said we only verbally separated and she started renting out elsewhere and I have been receiving tax relief as it was considered to be my PPR. We had simply sent a letter to the Revenue.

We will be going for a divorce soon and she would like to retain the house as her PPR and that will be included in divorce paperwork.

On another score, what chances would I have of securing another mortgage (no more than 140k, annual income 40 k)? Even though she would continue to make repayments on this joint mortgage (800 per month) following divorce, would banks take this scenario seriously against me?

I am just trying to move on with my life and any advise/opinions are greatly appreciated.


Thanks
 
So your name is off the deeds but still on the mortgage is that correct? Is your ex paying all of the mortgage then? Interested to see how this works - didn't know you could do that.
 
If you only require a small mortgage, perhaps your co. Council would be suitable. You would be considered a first time buyer with them after the divorce.
Their interest rate is about 2.75% over 30 with no increase in interest rates.
They will mortgage up to I think 97% of value of property, subject to a limit, which I do not know.
Good luck Browtal
 
@xoxoxo My name is still on the deeds, would not be pleasant to have such long liability with no underlying assets. I am ready to sign a document setting out terms such as giving up rights to the property provided she keeps repaying the mortgage. If she defaults and the bank comes back to me looking for repayments, then the clause of my right to the property would kick in. Something along those lines...

@browtal Thanks a lot, definitely worth checking this out with the council. Cheers
 
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