Mortgage Breakup – What Happens in the Event of a Divorce

Posted on Aug 28 2015 - 6:17am by Admin

divorceOne of the biggest benefits of being married is sharing everything with your beloved. From the smallest things to the big purchases, a couple has the comfort of going into any endeavor together. Yet, it backfires and becomes a nightmare in the event of a divorce. In many cases, it can get messy especially with the couple who has procured several, high-value items.

Nothing will complicate a divorce, financially, more than a mortgage. Not only because both spouses could have differing ways on how to proceed, but in the eyes of the lender, divorcing couples are still married. The economy crash of 2008 changed the rules because it affected the financial landscape from east to west, Miami to Denver. Divorce and family law courts also had to adapt when properties became liabilities rather than assets.

Ways of Proceedings

Divorcing mortgage isn’t easy, and it’s usually the biggest dispute among separating couples. That’s why couples should keep their emotions in check and focus on the finances. Civil separation is hard enough without the couple getting on each other’s nerves.

Now, there are three main ways where a mortgage dispute can conclude.

Selling the House – It’s the easiest way out. This method will be much harder, however, when a couple owes more mortgage than the worth of their house. They can elect for a short sale, but that will affect both parties’ credit record.

Refinancing – An easy approach, if a spouse agrees to let go of their ownership. If the couple isn’t underwater in mortgage and the owner-spouse has enough income and credit score to qualify for a refinance, it should be all right.

Sharing the Responsibility – If both parties aren’t able to come up with a viable solution, they can just leave the mortgage as it is. Then, there are FHA loans. It’s a bluestacks offline installer for pc little out there, but it wouldn’t hurt to try when options run out. On the other hand, a number of other financial options exist when they have exhausted all other choices.

Divorcing couples must accept that they still have to work some things out together after the breakup. Mortgage is one of those things. They can only resolve it, thoroughly, if they determine who’s responsible for what.