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Getting Divorced, What About the House?

Posted Wednesday, September 4, 2013

Over time love for your spouse has faded and you have filed for divorce. You may be ending the marriage, but that does not immediately remove your name(s) from the mortgage contract that you signed together when you bought your home. The couple may decide that one spouse will stay in the home while the other finds a new place to live. The decision of what to do with the home is decided during the divorce negotiations.

First you need to decide who, if either of you, is going to keep the house. Will either be able to qualify for a loan based on individual income and credit worthiness?  One spouse could buy out the other if there is enough equity in the home. What you agree upon should be included in your settlement, which both parties will agree to in mediation or through lawyers. A buy out may be tough if there is not enough equity in the home. But if one party can afford to keep the home, he or she should refinance it in his or her name. Allowing the other party to be free and clear of the mortgage.

If neither can afford to keep the home, the most economical thing to do is to sell the house. In many cases the sooner the home is on the market and sold, the better off for both parties. Until the home sells, it is very important to continue to make payments on the mortgage to maintain good credit standing.  

A fast sale is the best solution but be realistic, you need to have patience. Not all homes sell quickly. If you cannot sell your property before the divorce is finalized,depending on your circumstances, you may have to consider other options.

You could work with your bank and consider a short sale. Last resort, walking away and letting the home go in foreclosure. These options however can have a negative impact on your credit and finances, making it difficult for you both to purchase in the future.

 

If you need to quickly get out of the mortgage and yet want to avoid short sale or foreclosure, you may want to consider working with a We Buy Houses company to help you sell your home. We Buy Houses companies specialize in working quickly to purchase your home and can often close on a deal to purchase in less than 30 days, taking a huge amount of stress of what you are already dealing with in your divorce.