Options for dealing with your mortgage during a divorce

Options for dealing with your mortgage during a divorce

On Behalf of | Nov 20, 2023 | Divorce

Many married couples in Michigan own homes. Although your house brings comfort and security, that might no longer be the case if you’re getting a divorce. In that situation, you and your estranged spouse have options for dealing with your mortgage.

Mortgage transfer

If your spouse has enough money to take control of the mortgage, you can transfer it to them so that it’s only in their name. This is one of the common and easiest options for people who go through a divorce to deal with the marital home. However, you must provide the lender with a copy of the divorce decree and file a quitclaim deed. If your former spouse is amenable to being the sole mortgage holder, it takes you off the hook for paying.

One party moves out

Some divorcing spouses choose to keep their marital home. For example, if they have young children and want to share custody through nesting, the parties could keep the home, continue jointly paying the mortgage and take turns staying there with their children.

Sell the home

A lot of divorcing couples decide they can no longer continue living in their marital homes; as such, selling the house is often the best option for both parties. If former spouses can find a buyer, they can share the proceeds from the sale.

Refinance your mortgage

Refinancing a mortgage allows for removing one spouse’s name from the mortgage with the lender’s permission. From there, the other party can refinance, which means they are solely responsible for paying a new mortgage. This allows the parties to recover equity from the home; however, the person who refinances still has to pay until the remaining balance is paid.

During a divorce, there are always options for dealing with your mortgage. One might be more appropriate based on your personal or financial situation.