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Negative equity and unreliable ex-spouse

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Negative equity and unreliable ex-spouse

Hi everyone,

I have been separated for a year from my ex husband whose drug use caused a violent psychotic episode and subsequent hospitalisation last January. When we married 7 years ago, I had just settled on a small apartment (in my name only but I'm aware it is now a marital asset) where we lived, then rented out when we took out a joint mortgage on a small house. Later that year I gave birth to our only child, now six. Throughout the marriage we both contributed roughly equally to both mortgages, with me taking a year of maternity leave and him choosing to work part time and provide afternoon care for our child for about 18 months. We have roughly equal amounts in superannuation (pensions) (~$100k each) a paid-off used car each, and no other assets or savings to speak of.

Following his discharge from hospital, I was paying the mortgage payment for both properties and all bills and costs, which decimated our combined savings. I also used our savings to pay for his two attempts at rehab, both of which he checked out of. Once the savings were gone, he maxed out his credit card, roughly $10k I think, on his living costs while he got himself together. He is now working again and earns roughly $110k. I also work full time, recently gained a promotion, and earn about $92k.

I have 100% care of our child and we have a parenting plan developed via mediation that specifies he has supervised visitation, given his history of drug abuse and psychosis. Before he disclosed his drug use he admitted that he had driven her in the car while affected by drugs and that is my main concern for her welfare. He pays child support at a rate of around $37/fortnight and I receive family tax benefit and child care subsidy.

The housing market where we live has nosedived spectacularly and both properties are in negative equity. I have remained in the house, and when the tenants gave notice it seemed sensible for my ex-husband to move into the apartment as it would have been impossible to find new tenants at the previous rental rate.

Now we are each meeting the mortgage payments of the property we are living in but the house payment is approximately 50% of my take home pay so it puts me in significant financial distress. Both properties need significant renovations and maintenance. I recently had to pay a $4000 plumber's bill to rectify some DIY work he did badly, which was pretty much all the cash I had scrimped and saved during the year. I am also paying all household bills and expenditure relating to our daughter, although when I ask he does pay half of her medical bills, etc.

My ex is currently very remorseful and has been compliant so far but I am very concerned that this will not last, and he might flake out again at any moment, especially as he has not sought help for the ongoing mental illness that he was self-medicating for in the first place. I have no way of knowing if he is still using drugs. He recently missed several mortgage payments due to an internet banking error (he says) but he didn't realise until I rang and told him. He was somewhat financially irresponsible during our marriage, such as not paying his car registration and then getting big fines, etc.

Remaining joint mortgagees and waiting out the housing market seems to be a financially prudent option, especially as our daughter is so young and needs the security of a familiar home, but do you in your collective wisdom have any other ideas of how to manage the situation? I am almost completely unable to save and it leaves me in a very precarious position. I have investigated the option of renting out the spare bedroom in my home but it is not in a desirable area and I am wary of moving in a stranger with my daughter, who is emotionally fragile at this time.

I think my ex would be open to negotiating a maintenance payment so I can retain the house but I don't know how to go about calculating what is fair. The parenting plan is due for review in August but I don't want him to have overnight visits and I don't think he would push for them as the current situation suits him. I want to start divorce proceedings but am hesitant to impose the 12 months limit on the financial settlement while things are so grim. I'm in Australia if it makes any difference.
Thanks in advance,
Troppo5

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