Buying a house after divorce in Australia: a complete guide

Buying a house after divorce in Australia: a complete guide

Quick answer: Yes, you can buy a house after divorce in Australia. Most women apply as a sole applicant once their property settlement is complete or close to finalised, using their own income, savings, and any settlement funds as deposit. Lenders will assess your borrowing capacity based on your income alone, your existing debts, and your share of the asset pool. The right time to start is earlier than most women think. Speaking to a mortgage broker before settlement is finalised lets you understand what is realistic, plan your deposit, and avoid the most common mistakes that delay or derail a purchase. This guide walks you through the full journey, from the first conversation with a broker to settlement on your new home, with the questions you need to ask at each stage and the traps to avoid along the way.

I want to start with something I see almost every week.

A woman walks into my office, often after the worst few years of her life, and tells me she's been told she can't buy a house.

By her ex.

By her mum.

By a well-meaning friend who heard something from someone.

Sometimes by a banker who didn't take five minutes to actually look at her situation.

Most of the time, she can.

Not always in the suburb she wants. Not always at the price she wants. But almost always something. And the difference between "I can't" and "here's what's actually possible" is usually one conversation with the right person.

This is that conversation, in long form. If you are anywhere on the spectrum from "thinking about leaving" to "settled six months ago and ready to look," this guide is for you. Read the parts that apply, skip the parts that don't.

When can I start the home buying process during a divorce?

Earlier than you think. Most women in Australia can begin the conversation with a mortgage broker well before their property settlement is finalised. You won't be able to apply for a loan and buy a property before settlement is done, but you can do all the groundwork that makes the actual purchase fast and clean once you're ready.

The right sequence is usually:

• Six to twelve months before settlement: First conversation with a mortgage broker. Understand your borrowing capacity in rough terms. Identify any issues to clean up (joint debts, credit file problems, unsupported income).

• Three to six months before settlement: Tighten your financial position. Build your sole-name savings. Make sure your income is well documented. Pull your credit report.

• At or near settlement: Get formal pre-approval based on your finalised position.

• After settlement: Make offers and buy.

The single biggest mistake I see is women waiting until the day after settlement to start. By then, they have already missed weeks or months of preparation that would have made the process faster, cheaper, and far less stressful.

What do lenders look at when I apply on my own?

Sole applications get assessed more closely than joint ones. Not because you're seen as risky, but because there is no second income to fall back on if your situation changes. Here is what lenders want to see:

• Stable, well-documented income. PAYG income is the easiest. Self-employed and casual income are still possible, but require more paperwork.

• Clean credit history. No defaults, late payments, or unauthorised joint debts dragging your file down.

• Sufficient deposit. Usually 5 to 20 percent of the property value, plus stamp duty and other costs. Settlement funds and savings both count.

• Realistic living expenses. Lenders will ask. Be honest, but be accurate. Many women overstate their expenses out of habit from running a family budget that no longer applies.

• Manageable existing debts. Credit cards, car loans, buy-now-pay-later balances, HECS. All of it factors in.

• Genuine savings or evidence of financial stability. Most lenders want to see at least three to five percent of the purchase price held in your name for at least three months before the application.

The good news: the women I work with often discover they are surprised by what they can borrow, especially if they have been financially careful through the separation.

The not-so-good news: borrowing capacity for one person on one income is genuinely lower than for two, and the home you can afford post-divorce is often smaller, in a different area, or in a different style than the one you were in before. That is not a failure. It is a recalibration.

How much deposit do I need to buy after divorce?

The honest answer is that it depends on what you walk away from settlement with, and what other savings you have. In broad terms:

• 20 percent deposit + costs. This avoids Lenders Mortgage Insurance (LMI) and gives you the strongest application. Most achievable when settlement gives you a meaningful share of the asset pool.

• 10 to 20 percent deposit + costs. You'll pay LMI, but it's manageable, and many women in this situation are still in a strong position to buy. (No LMI if you qualify for the Australian Government 5% Deposit Scheme as a single parent or legal guardian.)

• 5 to 10 percent deposit + costs. Possible with the right lender and the right structure, sometimes with the help of the Australian Government 5% Deposit Scheme.

• Less than 5 percent. Possible if you qualify for the Australian Government 5% Deposit Scheme as a single parent or legal guardian. The scheme allows eligible single parents to buy with as little as a 2 percent deposit and no LMI.

Settlement money, savings, gifts from family, and proceeds from selling the family home all count toward your deposit, but each comes with its own documentation requirements. A mortgage broker can walk you through what each lender needs to see.

If you are a single parent, the Australian Government 5% Deposit Scheme (formerly the Home Guarantee Scheme) is worth understanding in detail. From 1 October 2025, the scheme expanded to remove income caps, scrap waitlists, and let eligible single parents buy with just a 2 percent deposit and no LMI. It can dramatically change what is possible for you. (I'll be writing a full guide to this scheme as part of the cluster , link to come once published.)

What about the family home? Can I keep it, or do I have to sell?

This is the question that brings most women into my office, and the answer is genuinely "it depends." There are usually three paths:

Path 1: You keep the home.

This means refinancing the mortgage into your sole name, often combined with paying out your ex's share of the equity. Whether this is possible comes down to your serviceability on a single income and the size of the buyout. It's a more involved process than a standard refinance, and timing it correctly through the divorce process matters. (I'll be covering this in detail in a separate post: Refinancing the family home into your name after separation.)

Path 2: He keeps the home.

He refinances into his sole name and pays you out. Your share becomes part of your deposit for a new place. This is often the cleanest option if neither of you is sentimentally attached to the property.

Path 3: You both sell..

The home sells, the mortgage is paid out, and the equity is split per your settlement. Both parties start fresh with their share of the proceeds.

There is no universally right answer. The right path depends on your income, your share of the asset pool, your children's stability, your emotional bandwidth, and what makes financial sense for your future, not just your past.

What are the most common mistakes women make in this process?

I see the same handful of mistakes repeatedly. Here they are, so you can avoid them:

• Waiting until settlement is done before having any financial conversation. By then, you've lost months of useful preparation time.

• Getting pre-approved too early, before settlement is clear. Pre-approvals expire. Getting one too early means you'll need to re-apply when you're actually ready, and your situation may have changed.

• Underestimating their own borrowing capacity. Many women have been told (by their ex, by family, by themselves) that they "can't afford to buy on their own." Often, this isn't true.

• Overestimating their borrowing capacity. The flip side. The household income you used to share is not the income you can borrow against now.

• Not cleaning up joint debts before applying. Joint credit cards, joint car loans, anything still in both names will appear on your credit file and reduce what you can borrow.

• Not separating finances early enough. A bank account in your sole name, with your income flowing in and your expenses flowing out, creates a clean record that makes loan applications far easier.

• Trying to do everything alone. A mortgage broker, a family lawyer, and a financial counsellor or adviser are not luxuries during a divorce. They are essential infrastructure. Most offer free initial consultations.

If you have not yet started this process, [Five things to do before you tell him you're leaving] is a good starting point for the financial groundwork.

If you've already left and are wondering how you ended up without your name on the title, [Stupid, I Know] covers that exact territory.

What about debts in joint names?

Joint debts are one of the most overlooked issues in post-separation home buying. As long as your name is on a debt, even if your ex agreed to pay it as part of settlement, you remain legally responsible for it. And lenders will still count it against your borrowing capacity until it is paid out, refinanced, or formally removed.

This is critical. A property settlement document is between you and your ex. It is not a contract with the bank. The bank only cares whose name is on the debt.

Before applying for a home loan, every joint debt needs a clear plan:

• Pay it out fully from settlement proceeds where possible

• Refinance it into one party's sole name, removing the other

• Close the account if it has a zero balance

• Document the agreement if it must remain joint for a period

A mortgage broker and your family lawyer should be talking to each other (or talking to you) about this, because the order of operations matters. Refinancing the family home, paying out joint debts, and applying for a new loan all interact, and getting the sequence wrong can cost you months.

How long does the whole process actually take?

For a clean, well-prepared application, from first broker conversation to settling on a new home, expect:

• Preparation phase: 3 to 6 months (longer if your finances need cleaning up)

• Pre-approval to property offer: Variable, depending on the market

• Offer accepted to settlement: 30 to 90 days, depending on the contract

• Total realistic timeline from first conversation to keys in hand: 6 to 12 months for most women

That timeline assumes settlement of the divorce is either complete or well advanced. If you're earlier in the process, the financial preparation can run alongside, but the actual purchase can't happen until your share of the asset pool is settled.

Frequently asked questions

Can I get a home loan before my divorce is finalised?

You can start the conversation and do all the preparation before your divorce is finalised, but most lenders will want your property settlement to be either complete or formally documented before they approve a loan. This is because they need to know exactly what assets and debts are yours, and what you are walking away with as deposit. A mortgage broker can advise on the timing for your specific situation.

Will my ex's debts affect my home loan application?

Joint debts will affect your application until your name is removed from them, even if your settlement says he is responsible. Solely owned debts in his name only do not affect you. The simplest way to clean this up is to pay out, refinance, or close any joint debts before you apply for a new home loan chat to your broker about this, they can help.

Can I use my settlement payout as a deposit?

Yes. Funds received from a property settlement can be used as a deposit on a new home. Lenders will ask for documentation showing the source of the funds, including your settlement agreement. Keep all paperwork from your settlement organised, because it will speed up your loan application significantly.

How much can I borrow as a single woman in Australia?

Borrowing capacity is calculated on your income, your existing debts, your living expenses, and the lender's serviceability buffer. The most accurate way to find out is to have a mortgage broker run the numbers for you, including any child support or other ongoing income you receive, against multiple lenders.

Should I rent first or buy straight away after divorce?

Both are valid. Renting gives you breathing room to settle into a new area, see how single life feels, and understand your real living costs before committing to a mortgage. Buying gives you stability, locks in your housing costs, and starts building equity in your name. The right choice depends on your finances, your emotional state, and your timeline. There is no rush, and there is no failure in renting for a year or two while you find your feet.

You're allowed to plan a future that is yours alone

I started this guide with a story about women being told they can't buy a house. I want to end it with a different one.

Most of the women I work with land somewhere they did not expect when they first walked through the door. Sometimes that's a smaller home in a different suburb. Sometimes it's a place that needs work. Sometimes, much more often than people assume, it's something better than the home they left behind, because for the first time in years it is genuinely theirs.

You are allowed to want that. You are allowed to plan for it before everything is finalised. You are allowed to ask hard questions, run numbers, and make decisions that are about your future, not your past.

The women who land best after divorce are almost always the ones who started the conversation early, built the right team around them, and gave themselves permission to imagine a life that wasn't a downgrade from the one they had, but a redirection to one that fits.

If you want a private, free space to start working through your numbers, your goals, and your next steps, that is exactly what Runa was built for. No broker calls. No sales pitch. Just the tools and the knowledge to help you understand where you stand and what is possible from here.

Sign up free at [runaapp.com.au]

If you would like to talk through your specific situation, I offer confidential, no-obligation conversations for women navigating divorce and the home buying process that follows. There is no pressure, and there is no cost.

Book a confidential conversation at matildatree.com.au

You may also find these helpful

• Five things to do before you tell him you're leaving

- Stupid, I Know: why so many Australian women find themselves starting over without a home in their name

- Refinancing the family home into your name after separation

• What happens to your mortgage if you separate before settlement?

• How to leave a financially controlling relationship: practical first steps

Sources and references

• Australian Government 5% Deposit Scheme (formerly Home Guarantee Scheme)

This post also draws on Rielle's professional experience as a mortgage broker working with Australian women navigating separation and divorce.

*This article is general information only and does not constitute financial, legal or tax advice. Please speak to a licensed financial adviser, solicitor and your superannuation fund about your specific circumstances.

**Rielle Berglund is a mortgage broker and the founder of Matilda Tree Finance. She works with Australian women navigating major financial transitions, including separation, divorce, terminal illness and bereavement. She is also the creator of Runa, a free financial literacy app built for exactly this stage of life.

Tags:

• Separation and Divorce