How to Resolve the Property Mortgage After Divorce?
Sadly 50% marriages in the US end up in divorce. Love goes away, and the marriage ends. However, your breakup does not remove your liability to pay the mortgage. Banks do not care whether you are together or not, they want their money. Otherwise, they just send the default notice to foreclose your home.
Too often, foreclosure and divorce are closely tied together. Couples become so busy with their emotional lives that it is hard to focus on the financial aspects of a divorce. If you are getting a divorce, it is time to gather yourself and do what is best for you in the long-term.
Do you want to keep the house? Would you have bought this place if you were single?
Do you want to let go of the property?
What will be your share in the home equity? In California, any marital property is distributed equally among the both spouses, but there may be some exceptions to this case. Spouses with higher income and a graduate degree may receive less than the 50% share.
If you would like to keep the home, then you must refinance. Otherwise, you can sell the home and leave this debt behind you.
How to Refinance a Home During Divorce?
When letting go of the property, you should never sign a “quit claim deed.” If you sign this claim, then you will take off your name from property ownership documents, but you are still responsible for paying the mortgage. To free yourself from this responsibility, your ex must refinance the mortgage.
Refinancing a loan has some conditions. The new owner must have a high credit score with a high income. To get your application approved, start the process early, compare different mortgage rates and see which one can work for you.
Some banks in California won’t approve this request unless the divorce is finalized. Keep in mind; you can always find a local bank to refinance the mortgage while you are separated and not officially divorced.
Sell the House
Going through a divorce is painful and selling a family asset is a tough job. You can sell your house through a Bay area divorce agent or a real estate solutions company. You can also call us if you would like to sell your home within as little as 10 days.
Once the sale of the home is complete, you will be free from the mortgage. Both spouses will get their share of the home equity, and you can move on with your lives.
How to Keep the House?
Partners can also come up with an agreement to keep the house. Based on your communication, you will decide who will pay how much money. If one person is responsible for the mortgage, he should sign the “deed of trust.” The deed of trust gives an opportunity to the non-paying partner to foreclose the house if the other spouse stops paying the mortgage.
If both partners want to pay, then they should consider their individual earnings. You must keep paying the mortgage mutually. The mortgage will be paid on the due date, and you both will own the family house.
Whatever choice you make, it is best to discuss your case with a divorce attorney. Feel free to call us for any questions or queries.
About the Company:
JJW Homes LLC is a residential redevelopment company operating in San Francisco, Bay Area. We offer real estate solutions to our clients. With the help of our extensive network, training, and years of experience; we can help you out of any real estate problem.
Just give us a call, and our team will get in touch with you.