Naturally, we hope that all of our readers are happily married! But statistics show that not everybody is, and divorce is as much a fact of life for many families as are taxes. When you co-own property with the person you’re divorcing, it complicates an already complex (and often heartbreaking) situation, because you’re not just ending a personal relationship—in many ways, you’re ending a business relationship as well.
If you own a home and have a joint mortgage on the home, you’ll need to detail who will be responsible for the ongoing mortgage payments.
Your home is your largest joint investment and is probably at the top of every contentious—and even less contentious—divorce in this country. No matter how you decide who will end up owning the property, there’s still going to be the question of that mortgage that is in both your names and that continues to require servicing.
Often the decision is that whomever retains the home will take over the mortgage, and the usual procedure is that a period of time is granted during which the person living in the home has the opportunity to refinance—that is, apply for and get a mortgage for the property that doesn’t have their former spouse’s name on it.
The reality is that courts can’t dictate to the mortgage lender to remove one name from their documents. There are only three ways to get one’s name off a mortgage:
- refinance the mortgage
- pay off the mortgage with cash
- die (and prove it with a death certificate)
It gets more complicated, however. During that period of grace, if the partner living in the home and making the mortgage payments makes a payment late, both parties will take a hit on their credit scores. That may not seem like a big deal, but for the person moving on, a dip in their credit score may affect their ability to get a mortgage on a new home.
There are a lot of reasons why it’s a good idea to get help with financial planning around your divorce, just as you probably did throughout your marriage. At Avrus Financial and Mortgage, we’ve helped people refinance homes after a divorce and have helped people move on to new homes and start over. We’re not emotionally compromised, as you might be, and we can help you get through the dissolution of your business partnership in terms of your mortgage as you start your new life.
Why not ask us how today?
