Refinancing Your Home After a Divorce
Divorce can be nasty. With the many emotional traumas that occur with it, it also tags along financial problems too. Many couples struggle with splitting their properties and belongings the legally correct way right after their divorce. If the property is still due upon loan, it is important for the spouses to decide who will pay off the loan. Ideally, both spouses should include their respective shares, but if one spouse is financially stronger than the other, they may take up responsibility of the loan, after divorce, with the other spouse buying themselves out of it.
What is meant by refinancing?
Refinancing is when a couple splits their assets and liabilities in between themselves, as per their convenience. They may take a share with respect to what their financial condition permits. For example, if there is a loan to be fulfilled, one spouse takes up full responsibility of it, and the other spouse can give up his/her rights to the ownership of that particular property. Many a times, it is the spouse who earns better than the other, and is in a better financial position to pay off the loan.
How to go about the procedure?
Although as simple as it may seem, refinancing is a procedure that will take up much of your time and effort. According the assets the couple owns, they will have to invest their time accordingly. It is a legal procedure and deeds to be done with the knowledge and permission of both spouses.
While refinancing, you can either consider buying out your share from your spouse, or keep paying them half of the share that you owe them. You can easily opt out by paying them your share of the property that needs to be paid. If you are not financially strong to pay back your share, you can do it by other means like mortgaging or by giving them some of your assets.
Have a word with your lawyer regarding the value of your property or apartment. The refinancing depends on quite a lot of factors like prenuptial agreement, or by any other pre-marriage contracts. Also, the house or property must be a purchase of both spouses together. Any premarital property of one spouse is not entitled to receive any share form the other spouse, unless mutually agreed upon. Have the best lawyer to your advantage to navigate you through these legal procedures.
Divorce brings with it plenty of its own complications. You do not want to add to it by inducing more complications regarding refinancing. You can even have both of you spouses contributing equally to putting off the loan. You can talk with your legal advisor and zero down on a method that suits the needs of both spouses. Although it is an emotionally and physically draining affair, make sure you keep your sanity intact in order to avoid falling prey to scams.
Try and get the best professional help as possible in order to make it less complicated. Have the best mortgage lender working to your advantage so that you do not face heavy financial losses. Your divorce should be your top priority right after you split up. You can build your life back up from scratch if you are financially secure, or at the least, not financially burdened by loans or mortgages
Going Through A Divorce & Have questions?
Jimmy Sgambelluri is a licensed mortgage professional with PrimeLending. He can help you with any questions you may have about mortgages, refinancing, & what options you have when getting divorced.