The Divorce Process Begins
Once you have decided that you and your spouse want a divorce, it usually starts with filing a complaint. Once this is filed, you will go through a mandatory waiting period which is implemented by the state. During this time, you will work with your attorney(s) to divide the marital assets, one of which being your marital home.
The first decision you and your spouse must make, is if one of you will be keeping the house, or if you both want to sell it. According to Kara, it is most common for a party to come to this decision on their own with assistance from their attorney(s) only to draw up the necessary agreements. This is known as a collaborative divorce with mediation of the asset.
Occasionally, collaboration is not possible. In this instance, you and you spouse will go to court and have a judge divide up your marital assists for you. This is known as litigation and is usually one of the last options your attorney will recommend.
One Party is Keeping the Home
You and your spouse have decided that one of you would like to keep the house. Regardless of who is staying and who is leaving, the first aspect that you need to address is the ownership and financial responsibility. You will need to talk with my team to refinance the mortgage on your residence in the name of the person who is keeping the home.
A common mistake for those getting divorced is to only change the ownership by changing the deed. However, you must also refinance if both party’s name’s are on the mortgage. You and your spouse will BOTH remain financially responsible for the mortgage until the refinance is complete. That means even if you no longer live there, but your ex-spouse isn’t making their monthly payments, the bank can and will come after you.
Another piece of advice Kara gives her clients is not to sign off on the removal of your name from the deed until the refinance is complete. It is more important for you to be removed from the financial responsibility to be sure you are not obligated to pay on the mortgage once you are divorced.
The Refinance
It is important to talk with my team before making any official decisions regarding who is keeping the home. We, as the lender, have to evaluate both parties finances to make sure whoever would like to keep the home can afford to. This includes the cost of the refinance, the monthly payments, and the payment they must make to their ex-spouse for their share of the equity in the home.
If the divorce decree has not yet been filed, we will also need a Marital Settlement Agreement (MSA) from your attorney in order to complete the refinance. This is the official document that divides you and your spouse’s assets so we know the terms of the divisions for each party.
The Right Lender and Attorney
There are many options for you and your spouse when it comes to getting a divorce and what happens to your marital home. If you have any questions or would like more information, please reach out to my team regarding your home, and to Kara regarding your divorce.