When it comes to property division in a UK divorce, the family courts prioritise fairness for both parties and the welfare of any children involved. The courts have considerable discretion when deciding on who should get the house or property after divorce and will take into account the needs and resources of both parties, child welfare, property ownership, whether the property is a matrimonial or non-matrimonial asset, and the contributions of both parties. While the starting point in any division of property matter following divorce is a 50/50 split, the final decision will ultimately be based on the facts of the case and judicial interpretation. All of this means that outcomes can vary significantly based on individual circumstances. In this article, we will explain everything you need to know about divorce and property in the UK, including the legal factors that determine the final outcome of a divorce financial settlement.
Please note: this article is intended for informational purposes only and should not be considered legal advice. If you have any questions about your property and divorce, please contact our divorce lawyers.
Key factors influencing the division of property in UK divorce
Some of the key factors influencing the division of property in a UK divorce include (please note this list is not exhaustive):
- The needs and welfare of the children
- Whether the property is matrimonial assets or non-matrimonial assets
- The financial needs and resources of both parties (also covers standard of living during the marriage in the explanation)
- Contributions of each party, and
- Pre-nuptial and post-nuptial agreements
The needs and welfare of the children
Firstly and foremost, the courts will always prioritise the needs of any children under the age of 18 who live in the marital home. This is because they want to avoid the potential for disruption to the welfare and daily lives of the children following divorce. It can be extremely difficult for children if they are not able to remain in the family home with the parent with whom they will be living on a day-to-day basis. Other factors that a family court judge may consider include the wishes of the child (depending on their age and level of communication) and the proximity of the property to the child’s school, family, and friends.
Whether the property is matrimonial assets or non-matrimonial assets
The judge hearing the divorce financial settlement case will look at whether the property is classed as a matrimonial asset or a non-matrimonial asset. If the family home was owned by one party before the marriage, it may still be considered a matrimonial asset if it was then used for the benefit of the family during the marriage. On the other hand, if the pre-marital property was never used by the family, it may be ring-fenced from the divorce settlement agreement. This may also be the case if one party received the property as a gift or inheritance. The determination as to whether a property is a matrimonial or non-matrimonial asset is a complex matter based on the unique factors of the case.
The financial needs and resources of both parties
One of the primary considerations for any family court judge deciding on a financial settlement where property is concerned is the financial needs of both parties. They will look at factors such as the standard of living during the marriage, the financial resources of both parties (i.e. income, savings, investments), and whether either party has the financial means to purchase another property.
Contributions of each party
When ruling on a financial settlement involving property, the judge will assess the extent to which both parties contributed to the family home. While financial contributions to the family home will be considered, other forms of contribution will also be taken into account. For example, if one party agreed to be the primary income earner while the other remained at home to look after the home and children, as far as the court is concerned, they will both have made a contribution.
Pre-nuptial and post-nuptial agreements
While pre-nuptial and post-nuptial agreements are not legally binding in England and Wales, family court judges will look at whether one exists and whether its contents may impact the outcome of the divorce financial settlement. It is important to bear in mind that even if the agreement precludes one party from receiving a particular asset (i.e. a property or other asset) in the event of divorce, the judge can still use their discretion to disregard this if the needs of the other party mean that it should be sold, divided, or transferred.
How to split a property in a divorce
In a divorce in the UK, the division of property can be handled in a number of ways depending on the circumstances of the case. Some of the most common ways to split a property in a divorce include:
- Sale and division
- Buyout
- Deferred sale with ‘Mesher’ order
- Transfer of ownership with a legal charge
Sale and division
It may be concluded that the marital property should be sold and divided between both parties. This is often the case if there are no children from the marriage. The decision to sell and divide the property may also be made because there is a lack of other marital assets that can be used to divide between the divorcing couple to meet their financial needs. It should not be assumed, however, that the proceeds of the sale will be 50:50. The judge may award a different ratio, for example, if one party made a considerably larger contribution to the property or their financial needs outweigh those of the other party.
Buyout
In some cases, it may be concluded that the property should be ‘bought out’ (i.e. purchased outright) by one party from the other, giving that person sole ownership. This typically occurs when one party wishes to stay in the home (e.g. for the benefit of the children or because they have a strong attachment to the property). The complicating aspect of a buyout of a marital home is that one party has to hold or borrow all of the funds necessary to buy the other party’s share of the property. Another complicating factor is that it is up to the couple to agree between themselves on how much one should pay the other for their share. If an agreement cannot be found after a valuation has taken place, it may be necessary to consider mediation or another form of non-court dispute resolution.
Deferred sale with ‘Mesher’ order
In divorces involving children, it may be agreed to postpone the sale of the property until the children reach the 18 or when they leave home. In this case, the judge will issue a Mesher Order. While a Mesher Order can avoid the upheaval for children of having to leave the family home, it can also mean that the non-resident party may not have sufficient means to purchase their own property until their children are older. It is also not possible to achieve a clean break with this type of arrangement because both parties remain financially tied until the home is eventually sold and the proceeds divided.
Transfer of ownership with a legal charge
“Transfer of ownership with a legal charge” refers to a legal arrangement in which one spouse transfers their share of a jointly owned property, typically the family home, to the other spouse, while securing a legal charge over the property in their favour. This charge acts as a form of financial protection to the other spouse, similar to a mortgage.
For example, if the wife remains in the family home with the children following a divorce and the husband transfers his share to her, a legal charge may be registered to ensure he receives his share of the equity when the property is sold or when the children reach 18. This arrangement is often used when one party cannot immediately afford to buy out the other’s interest. To ensure the terms are legally binding and enforceable, the agreement should be included in a financial consent order approved by the family court.
Divorce and property: Frequently Asked Questions
What happens to property owned before marriage in the UK?
In the UK, property owned before marriage is generally considered non-matrimonial and may not automatically be subject to division in a divorce. However, if the property was used for the benefit of the family, for example, as the family home or a source of income, it can be taken into account in the financial settlement. Other factors that determine what happens to property owned before marriage include:
- The length of the marriage
- Whether the property was mentioned in a pre or post nuptial agreement, and
- Whether the non-owning party contributed to the property.
In addition, if the marital assets are not sufficient to meet the needs of both parties, family court judges have the discretion to order the sale and division of property owned before marriage.
Check our article to understand more: What Happens to the Property Owned Before Marriage in a Divorce
Is my wife / husband entitled to half my house even if it’s in my name?
No, if you own the family home and only your name is on the deeds (i.e. it is in your sole ownership), while your wife/husband is entitled to a fair share of the property in the event of divorce, this does not mean it will be a 50:50 split. The exact split will depend on a range of factors such as the length of the marriage and your financial needs and resources and those of your ex-partner.
What happens to property acquired after separation but before divorce in the UK
There is no definitive answer to what happens to property purchased after separation but before a divorce. Indeed, this is something of a legal ‘grey area’. Property acquired after separation but before divorce in the UK may be considered a non-marital asset, but this will be at the discretion of the judge. It is more likely to be viewed as a marital asset and, therefore, divided between both parties, if the other marital assets are insufficient to meet the financial needs of both parties. If you are planning to purchase a new home before your divorce has been finalised, it is always advisable to seek legal advice before doing so.
Can I buy my wife / husband out of the house before divorce?
While it may be possible to buy your husband or wife’s share of your marital home before you divorce (i.e. if you don’t want to wait), it is always better to do this as part of a divorce financial settlement. Doing so will ensure that the arrangement is set out clearly in a way that makes it clear what was agreed. Do be aware, however, that buying out your partner’s share of the property can be risky because they may still be able to claim a share of your property and they may still have marital home rights until the divorce is finalised. In other words, they may still have the right to live in the property until the Final Order is issued by the court. If you take this approach, it is important to instruct a divorce solicitor who can explain the implications legally and financially and what you can do to protect your interests.
Can I sell the property before divorce settlement in the UK?
It is normally recommended to wait until the divorce has been finalised and you have a divorce settlement in place before selling the family home. Selling your marital home early before you reach a final settlement may lead to financial and legal claims, tax implications, and complications when it comes to your divorce financial settlement. If you both want to sell your marital home before you reach a divorce settlement in the UK, speak to a divorce solicitor in the first instance for advice and guidance based on your circumstances.
Check our article to understand more about this: Selling Property Before Divorce Settlement in the UK
Who gets the house in a divorce with children?
In a divorce involving children, it is normally the resident parent (i.e. the parent who the children will live with) who gets to stay the house. This is because the courts prefer to ensure that the children of separating parents have stability following the divorce. This does not necessarily mean that the property is always transferred into the sole ownership of the resident parent, however. Depending on the circumstances of the case, it may be that the sale of your marital home will be deferred until your children reach the age of 18 or they leave home. Whether a marital home is transferred into the ownership of the resident parent or the sale of the property is deferred depends on the needs of all parties including the children and the financial resources of both parents.
