Find principal repayments in the mortgage statements
Principal repayments reduce the amount borrowed. Interest pays for borrowing; a monthly bill may also contain taxes and insurance. Use the principal entries on the statements rather than multiplying the total monthly payment by the number of months.
If payment shares changed, calculate each period separately. Check extra repayments, refinancing and new borrowing too: subtracting the closing loan balance from the opening balance may not give the principal contributions you want to recognise.
Work through a 70/30 repayment example
Suppose the statements show $40,000 of principal repaid over five years. If both partners recognise contributions in a 70/30 ratio, that records $28,000 for A and $12,000 for B.
Those credits can be returned before dividing the remaining equity, or used to set a ratio for all the equity. The comparison below shows why the choice matters.
Illustration: $40,000 principal repaid, with $28,000 recognised for A and $12,000 for B. Current net equity is $200,000.
| Selected method | Partner A | Partner B |
|---|---|---|
| Divide current equity equally | $100,000 | $100,000 |
| Return principal credits, then divide the rest equally | $108,000 | $92,000 |
| Divide current equity in a 70/30 ratio | $140,000 | $60,000 |
Principal credits reallocate existing equity. They are not added to it. The 70/30 ratio applies only if that is the method you expressly choose.
Include the agreed contribution history once
Current equity already reflects the lower outstanding mortgage. A credit changes how that equity is divided; it is not added to the home’s value or subtracted from the mortgage a second time.
Decide whether the model also recognises unequal down payments or renovation costs and labour. One partner may have paid more mortgage while the other covered childcare or other household costs. The software does not decide how those arrangements should be treated.
Enter your checked totals in the house buyout calculator. It compares methods using those totals; it does not reconstruct the loan history or import bank statements.
Record mortgage payments made after separation
If one partner continues paying after the other moves out, identify that period separately. Record who paid, which funds were used and how much went to principal. Agree the date up to which the proposed credit runs, then update the loan balance to the same date.
Paying the mortgage and occupying the home are different facts. Do not silently offset one against the other or assume either creates an automatic claim. Record any proposed adjustment for review, with advice where needed.