Re-mortgaging the home
Where one spouse owns the matrimonial home the non-entitled spouse must also consent to the granting of a mortgage over the home. This does not apply to the original mortgage granted at the time of purchase as the home is not a matrimonial home at the point of purchase.
Independent advice
As additional mortgages can often be used to re-finance existing personal or business debt, the non-entitled spouse should seek independent advice before consenting to the grant of a mortgage over the matrimonial home. If the lender does not advise the non-entitled spouse to seek independent advice then the mortgage may not be effective against that spouse or against the home.
Obtaining consent
Re-mortgaging of the property must have the consent of the joint owner, or the non-entitled spouse where there is a sole owner. A further advance on the existing mortgage may also require consent. Whether it does or not will depend on the wording of the original standard security. If it is for all sums due, then the further consent will not be required. If however the original standard security is for a fixed sum, any advance on that will require the consent of the non-entitled spouse. The latter wording of a standard security is the most common.
Dispensing with consent of the non-entitled spouse
Where the entitled spouse wants to re-mortgage the matrimonial home but s/he does not have the permission of the non-entitled spouse, s/he can apply to the court for an order dispensing with the consent of the non-entitled spouse. [1] The court can make such an order if any of the following criteria are satisfied: [2]
The spouse's consent cannot be given by reason of physical or mental disability.
The spouse cannot be found despite reasonable steps taken to trace her/him.
The spouse is below an age at which s/he is legally entitled to give consent.
The consent of the spouse is being un-reasonably withheld.
The court will find that consent has been unreasonably withheld if: [3]
the non-entitled spouse would not be affected by the dealing and has led the entitled spouse to believe that s/he would consent to it or
the entitled spouse has, despite taking all reasonable steps, been unable to obtain an answer either way from the non-entitled spouse.
In deciding whether to dispense with consent the court will consider all the circumstances of the case. [4]
An order dispensing with written consent of the non-entitled spouse may also require that any mortgage granted meet certain criteria. The court can set a maximum limit on the value of the loan [5] and/or specify that the mortgage agreement be executed before a specific date. [6]
Last updated: 29 December 2014