Separation is hard enough without worrying about the mortgage. But a joint home loan doesn't end when a relationship does. Both people remain responsible for the whole debt until it's refinanced, sold or otherwise resolved.
This is general information, not legal advice. A family lawyer should guide your property settlement.
Your joint liability
Most joint home loans are "joint and several". That means the lender can pursue either of you for the full amount, not just half. If one person stops paying, the other is still liable, and missed payments can affect both credit files.
Common options
1. One person keeps the home
The person keeping the home refinances the loan into their sole name and pays out the other person's share of equity, as agreed in the property settlement.
They'll need to: - Qualify for the loan on their own income - Have enough equity to fund the payout - Provide the signed financial agreement or court orders
2. Sell the property
You sell, repay the loan, and divide the remaining proceeds according to your settlement. In a softer market, as in parts of Sydney and Melbourne in 2026, this might mean less than expected.
3. Keep it jointly for now
Some couples keep the home jointly for a while, for example until children finish school. This needs clear agreement on who pays what, and it keeps you financially tied.
Refinancing into one name
Lenders assess the person keeping the home as a new applicant:
- Income: salary, plus child support and family tax benefits in some cases
- Expenses: including childcare and the cost of supporting children
- Credit file: joint debts and any missed payments
- Payout amount: borrowed on top of the existing loan if needed
Some lenders have specific policies for separation refinances, including accepting child support as income and allowing settlement documents in place of finalised orders.
The Family Home Guarantee
If you're a single parent and need to buy a new home after separation, the Family Home Guarantee allows a 2% deposit and no LMI, even if you've owned before. See our Family Home Guarantee guide.
Stamp duty
In NSW, transfers between spouses or de facto partners under a family law agreement or court order are generally exempt from transfer duty. Your lawyer or conveyancer can confirm.
Protecting your credit during separation
- Keep repayments up to date, even if you're arguing about who pays
- Talk to your lender if you're struggling. Hardship options exist.
- Consider asking the lender to freeze redraw or require both signatures, so neither person can withdraw funds unilaterally
- Check your credit report
Frequently asked questions
Can I take my name off the loan without refinancing?
Usually not. The lender must agree to release you, which normally means the remaining borrower requalifies.
Will child support count as income?
Many lenders accept it, especially with a formal assessment or court order and a regular payment history.
How long does a separation refinance take?
Often 3 to 6 weeks, once you have signed settlement documents.
Going through a separation? Call Finfident on 0424 545 654. We'll help you work out whether you can keep the home, with no judgment.
This article is general information only and doesn't take into account your objectives, financial situation or needs. Figures, rates and scheme rules are current as at October 2026 and can change. Finfident Finance Brokers (ABN 94 679 280 801) is Credit Representative 569374 of Outsource Financial Pty Ltd (ACN 131 090 705), Australian Credit Licence 384324.