Introduction
Separation is one of life’s most difficult transitions — emotionally, personally, and financially. For families managing a shared mortgage, property settlement is often the most challenging part. But with interest rates falling in 2026 and lenders competing to attract borrowers, there are opportunities for separated households to refinance, reduce repayments, and move forward with confidence.
Whether you’re in Sydney, Melbourne, Brisbane, Perth, Adelaide, Hobart, Canberra, or Darwin, knowing your options for property settlement can make all the difference to your financial and personal future.
Why Property Settlement is So Complex
Property settlement after separation involves more than just dividing assets:
- Who keeps the home? One party may refinance to buy out the other’s share.
- What happens with the mortgage? Both names may need to stay on the loan until settlement is finalised.
- How does equity get split? Current property values and outstanding loan balances dictate what’s available.
This process must also align with family law deadlines, which is why timing your refinance is critical.
2026 Brings a Silver Lining
Falling Interest Rates
- BOQ’s 4.89% fixed rate remains the sharpest in the market.
- NAB and ANZ are offering competitive fixed deals at 5.19%.
- The RBA is forecasting up to four rate cuts, which could lower variable rates below 5.25%.
Increased Lender Competition
More than 18 lenders now offer sub-5% rates, giving separated borrowers more options to refinance into one name and reduce repayments.
How Refinancing Works After Separation
- Equity Release The borrower keeping the home may release equity to buy out their ex-partner’s share.
- Sole Borrower Refinance The loan is refinanced into one person’s name, ending shared liability.
- Debt Consolidation Credit card or personal debt accrued during the relationship can be consolidated into the home loan at a lower rate.
- Fresh Start Loans For those starting over, new lender products help single-income borrowers enter the market again.
Savings Example
On a $500,000 loan with 25 years remaining:
- At 6% = $3,220/month
- At 4.89% = $2,900/month
That’s a $320/month saving — more than $3,800 annually, which is especially valuable for single-income households or parents managing child expenses.
Capital City Insights
- Sydney: With the highest mortgage balances, refinancing savings add up quickly.
- Melbourne: Intense competition among lenders makes switching more rewarding.
- Brisbane: Affordable property values make retaining the family home feasible.
- Perth: Rising property prices boost equity, supporting settlements.
- Adelaide: Smaller mortgages make refinancing more accessible post-separation.
- Hobart: Equity gains in recent years help families buy out former partners.
- Canberra: Stable public sector incomes improve refinancing approvals.
- Darwin: Regional lender policies vary widely — broker guidance is critical.
Real Client Story: Michelle in Canberra
“After separating, I wanted to keep the home for my kids. My broker helped me refinance into my name at 4.95%, saving me over $300 a month. It gave me stability and peace of mind during a really tough time.”
The Role of a Broker in Property Settlements
- Specialised Support – Brokers understand both family law and lending requirements.
- 50+ Lender Access – Brokers find lenders with flexible policies for single incomes or unusual financial arrangements.
- Timeline Management – Ensuring refinancing aligns with property settlement deadlines.
- Paperwork Assistance – Managing lender and solicitor documentation to reduce stress.
Risks of Not Refinancing
- Remaining tied to an ex-partner financially.
- Overpaying on outdated loan rates above 6%.
- Risking arrears if your ex doesn’t meet shared repayment obligations.
- Missing out on cashback offers and sub-5% rates.
Practical Steps for Separated Borrowers
- Review property value – Know your equity position.
- Gather financial documents – Income, expenses, and any child support arrangements.
- Check your rate – If it’s above 6%, you’re almost certainly overpaying.
- Engage a broker early – Align settlement timing with refinancing approvals.
📅 Book Your Free, No-Obligation Chat
At Money Tree Mortgage Brokers, we specialise in helping separated families navigate property settlements. From refinancing into your own name to comparing 50+ lenders for the best deal, we’ll guide you with compassion and expertise to achieve financial independence in 2026.
