EXCLUSIVE: Why Andrew Windsor and Sarah Ferguson's Scandal Saga is a 'Blessing and Curse' for Kate Middleton

RadarOnline.com can reveal is torn "beyond belief" over the latest scandal engulfing Andrew Mountbatten-Windsor and Sarah Ferguson, amid a new inquiry into royal finances and properties that has reignited tensions within the family.

The Princess of Wales, 43, and her husband, Prince William, also 43, were hoping for a quiet lead-up to Christmas, but the situation has escalated following questions about Andrew's "peppercorn" rent at the Royal Lodge, his longtime residence in Windsor.

Disgraced former duke Andrew, 65, who has faced longstanding public scrutiny over his association with the late financier Jeffrey Epstein, is due to be relocated as part of the Crown Estates review.

An insider told us: "Kate and William had hoped the lead-up to Christmas would be calm, but this new inquiry has escalated tensions. Among Andrew's estranged relatives, there's a sense of relief – or there soon will be – once he and Sarah are moved out of Royal Lodge and into their new residence away from Windsor."

The source added: "The King was understandably hesitant and anxious about formally stripping Andrew of his title and evicting him, but William pushed for action, arguing that his uncle's position had become completely untenable.

"He feels vindicated with no regrets about how it all unfolded and wishes it had happened sooner.

"In his view, Andrew is fortunate to still have a roof over his head or any support from the family after everything that's occurred."

Kate, however, has found the situation more complicated.

Sources said while she considers it a "blessing" Andrew will no longer live nearby, she remains "cursed" by the sympathy she has for Sarah Ferguson, 66, Andrew's ex-wife, who has suffered through two bouts of cancer.

A source close to the Princess of Wales said: "Kate is relieved, although it's somewhat difficult for her to acknowledge because she and Sarah were once close. She never liked the idea of living so near Andrew and feels much better now that he has moved farther away."

The source added: "Kate does feel sympathy for Sarah, but there's no denying she has made some very poor decisions. Trying to evade responsibility for so long has ultimately carried a heavy cost."

Further complicating matters, Andrew is said to be attempting to rekindle his relationship with Ferguson, a move Kate is said to view as dangerous.

"From her perspective, getting back together with him would be complete madness and total self-sabotage for Sarah," our insider said. "She really doesn't want Sarah to fall into his trap again."

Andrew's hopes of reconciliation, the source explained, are partly motivated by his limited prospects following the fallout from the Epstein scandal.

An insider said: "He believes that getting back together could be the only way for them to navigate this mess.

"Andrew still finds Sarah really attractive and feels very comfortable with her. "

And realistically, he doesn't have many other options. He is now a social pariah in London. "He keeps telling Sarah they could achieve more as a team and that the best path forward is to rebuild what they once had."