What happens to my loan if my partner and I divorce?

Wondering what happens to your loan if you and your partner divorce or separate? Many of the married couples in Australia that divorce do so after buying a family home. If this is looking like a scenario you are facing, we’ve summarised how you can handle your mortgage in this event.



Who will have to pay the mortgage after the divorce?


Regardless of your relationship status, the mortgage will still need to be repaid. If both you and your ex-partner are named on the loan agreement, you both have an obligation to meet your monthly repayments, regardless if you are living there or not. However, there are a few options you can consider.


Option 1: Transfer ownership of property

Depending on your circumstances, your court orders may stipulate that you either acquire the jointly owned property in your own right, or alternatively, your partner will acquire the property – this is called a transfer of ownership.

This may only be possible if you qualify for a home loan as a single applicant as you will need to take over the mortgage in your own capacity and afford the repayments yourself. Applying for the mortgage this way essentially mimics the process of a standard refinance application. You can choose to internally refinance with your existing lender, or alternatively take the opportunity to review the market and refinance to a new lender who may be able to offer more competitive features (this is where your broker can assist).


As usual, the lender will assess your borrowing capacity and ability to service the loan based on income, outgoings, monthly living expenses and the value of other loans you currently have (e.g. credit card debt, car loans, personal loans, HECS/HELP).


Whether the property is wholly transferred into your name or your partner’s, a transfer form will need to be generated to confirm the arrangement.


Option 2: Sell the property

Many separated couples opt for this incase where neither party can afford to meet the repayments alone. On a more positive note, if the property has been owned for a long period of time, there may be a significant amount of equity built up, meaning you could use this towards a deposit on another property. The profits will be divided accordingly between both spouses as directed by the court orders.


What happens if your ex-spouse refuses to sell?

In the event that your partner declines to sell the property that you both own, or you are unable to come to an agreement, the Family Court of Australia has the authority to compel them to do so. In the context of a divorce, the court can issue an order to enforce the sale of a house.


Have further questions, or want to explore which option is best for you? Chat to our leading professional lending experts today.


*This article provides general information only and has not considered your personal situation. Our comments strictly refer to the mortgage component of a divorce, of which the outcome is dependent on court orders and what has been agreed upon by both parties in legal proceedings. You should always seek professional advice in relation to your individual situation.

Are investors changing course after the new negative gearing reforms?

August 20, 2026
The Federal Government’s negative gearing and Capital Gains Tax (CGT) reforms represents a significant shift in how future property investments will be treated for tax purposes. For investors considering their next purchase, the changes may influence everything from the type of property they buy to how they assess cash flow and long-term returns. Legislated, many investors are reassessing their property purchasing plans and strategies. The core reforms have now passed Parliament, although some of the more detailed implementation rules are still being finalised ahead of their commencement. If you’re looking to buy an investment property down the track, here’s what you need to know about the reforms and how they change the playing field. What is changing? On 12 May, Treasurer Jim Chalmers handed down the Federal Budget , which included major changes to negative gearing and CGT rules. From 1 July 2027: Negative gearing for residential property investments will be limited to new builds. The 50 per cent CGT discount will be replaced with cost base indexation and a 30 per cent minimum tax rate on capital gains. Properties held before the announcement (7:30pm AEST 12 May 2026) will be exempt from the negative gearing changes, while the CGT reforms will only apply to gains accruing after 1 July 2027. How have the reforms affected the market and investors? When the changes were announced, Australia’s property market had already been cooling, driven by a combination of cash rate hikes, housing affordability constraints, the Middle East conflict, and cost-of-living pressures. But the Federal Budget reforms dampened the market even further, with auction clearance rates slipping to levels worse than during the pandemic, and investor confidence dropping. One survey of more than 1,400 Australian investors found that more than 80% believed residential investment property had become less attractive following the 2026 Federal Budget changes. At the same time, 51.5% said they planned to hold their existing investments and wait to see how the proposed legislation evolves. Overall, the survey offers a useful snapshot of investor sentiment, although it should not be taken as representative of every Australian property investor. Key shifts in strategy Since the announcement, there have been early signs that some investors are reconsidering where and how they invest, although it is too soon to say how the reforms will reshape the broader property market over the long term. New builds could attract more attention With negative gearing limited to new builds from 1 July 2027, there are signs that some investors are pivoting towards newly constructed properties. Data from property fund manager Oliver Hume shows the proportion of new-build sales to investors in Victoria has risen above 40 per cent for the first time since December 2024, for example. Experts say investors will likely switch to new units or houses on the outer city fringes, while suburbs in the middle of cities could experience a decrease in stock, potentially resulting in higher rents . Holding or grandfathering existing assets Investors with established properties purchased before 12 May 2026 may choose to retain those properties, as they are exempt from the negative gearing reforms and can continue to access the existing tax treatment that applies to grandfathered properties. These investors can keep negative gearing the property against their wage income and retain the full benefits until they sell. Cash flow could become an even bigger consideration Historically, negative gearing enabled investors to offset losses on established investment properties against their taxable income. But under the changes , investors purchasing established properties would no longer receive immediate tax relief on those losses. The changes may prompt some investors to focus more heavily on rental yield , cash flow and long-term returns when assessing investment opportunities. As a result, positively geared properties could become more attractive relative to investments that rely heavily on tax concessions to support returns. Some may also look for properties with the potential to transition to positive gearing over time as rental income grows. What about the changes to SMSF borrowing? In addition to the CGT and negative gearing reforms, there are new rules around self-managed super fund (SMSF) borrowing. From 10 August 2026, SMSFs can no longer use Limited Recourse Borrowing Arrangements (LRBAs) to buy residential property. Current LRBAs are grandfathered. SMSFs can still purchase residential property outright using cash , and LRBAs can be used to acquire business real property. The changes have been met with mixed reviews among investors, and some critics questioning whether it would make it harder for Australians to build retirement wealth . Some experts also believe that the changes could increase the appeal of commercial property among SMSF investors, although SMSF property investment can involve complex lending, tax and superannuation requirements, so specialist financial, legal and tax advice is particularly important. Considering an investment property purchase? The changes in the budget mean investors may need to think differently about the type of property they purchase, its cash flow and how the investment fits within their broader financial plans. While we can’t provide tax or financial advice, we can help you understand the lending side of the equation. We can review your borrowing capacity, compare suitable loan options and help you understand how different property and loan scenarios could affect your repayments and overall finance structure. If you’re considering your next investment property, get in touch! We can help you explore your finance options so you can make your next move with a clearer understanding.

What’s driving the drop in auction clearance rates?

July 20, 2026
After years of fierce competition, fast-rising prices and crowded auction weekends, the market is beginning to show signs of a shift. More properties are being listed for sale, homes are taking longer to sell, and buyers are becoming increasingly selective about what they’re willing to pay.