NSW Divorced, Engaged, Property Query

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15 September 2014
I am hoping I can get clear advice that will help me know what to do.

I am engaged to be married to my partner who is divorced approximately 3years. When he mortgaged his home while still married. He had to add his then wife's name to the property to get approval for the mortgage. He lives in the house and has been the sole person paying off the debt. When he filed for divorce it all went through smoothly and without going to court.

My question is, if my fiancé died, where do I stand legally? I am living in his home and have been for just over a year, so I have sunk money into renovating the kitchen, buying furnishings, etc. My fear is that she and the two adult children will claim the home leaving me out on the street loosing everything. Can this happen? Is there something under property law that my fiancé and I can do to ensure my fears are not realised?


Hi Synthia,

Assuming your husband and his ex wife are registered as joint tenants on the title, if your husband were to die, the property would automatically pass to his ex. On death of one Joint Tenant the surviving Joint Tenant or tenants acquire the whole property automatically by operation of law. Therefore property held in joint tenancy does not form part of the estate of the tenant who dies. So your husband cannot gift the property to you in his will.

You cannot just “take over” the mortgage. Under Australian laws you are not permitted to simply remove or replace someone from a mortgage agreement. In order to remove your husband's ex from the mortgage and property title, your husband will need to buy out your ex-partner’s share of the property, or sell the home and divide the sale proceeds. Alternatively, you will need to refinance the loan to a new loan that is solely in the name of the person who will retain ownership of the property. How seamlessly this can be accomplisehd, will depend on whether your husband and his ex had agreed on what her share of the house if any would be after they separated and divided their other assets. If this was not considered as part of their property settlement and put into writing, you may face additional challenges negotiating what she is entitled to.

I would seek legal advice on this one.
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