DIVORCE AND MORTGAGES
One of the biggest decisions divorcing couples face is what to do with the marital home. If the breakup is acrimonious, trying to agree on the house and the mortgage can be a nightmare.
The options for divorcing couples depend on a number of factors, such as how their property was financed and titled, whether one partner wants to stay in the home, the amount of equity they have in the home and their credit rating.
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More about divorce and mortgage options
Refinancing your mortgage
Some couples with a joint mortgage decide to refinance after divorce into one name. What this does is release the spouse whose name is coming off the loan from responsibility for the mortgage.
However, unless that partner’s name is also removed from the title, they can still benefit from the sale of and equity in the home, so it’s important to not only refinance but also to update the title to reflect one owner.
When only one spouse is on the mortgage, but both are on the title, a quitclaim deed will come in handy. A quitclaim deed is commonly used to remove a spouse’s name from the title in a divorce.
A big factor for many divorcing couples is the reduction in income and assets that help borrowers obtain the best mortgage rates. The mortgage rate you get after a divorce will depend on the same factors that determine other borrowers’ rates, such as your income, debt, credit score and the market environment.
Purchasing a home during or after divorce?
If you are going to be looking for new housing altogether, we can help with that too. It’s important to talk with an experienced mortgage professional to obtain an accurate preapproval inclusive of the impacts from the divorce.
Got questions? Give us a call at (412) 302-1919. One of our mortgage specialists would be happy to answer all of your questions and get you started with a great low rate today!