When you have to sell your house after a divorce?
Photo credit: Jonathan Livnat
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Divorce is painful, complicated and often messy. And when there’s a mortgage loan involved? That makes life is even more complicated for spouses who are separating. Around 42% of marriages end in divorce, according to the Office for National Statistics. So having to work out how a divorce will affect your mortgage is not that unusual.
Ideally, spouses either agree to sell their home or refinance their mortgage so that only one person’s name is on it. That former spouse is then responsible for making the mortgage payments each month.
Unfortunately, this idea isn’t always attainable. Often, one spouse will remain in the home. The divorce agreement will then spell out who is responsible for paying the mortgage.
This can lead to serious problems: What if the spouse who lives outside the home is supposed to pay the mortgage but stops doing so? This will cause the other spouse’s credit to plummet. This spouse’s name remains on the mortgage, so missed payments will drop this owner’s credit score just as severely as it will the spouse’s who was supposed to pay.
“A jointly acquired home loan has the unfortunate potential to become a disaster for your credit during a divorce,” said Michelle Black, president of Hope4USA, a credit-counseling service in Charlotte, North Carolina. “Your mortgage lender will not care about your divorce decree. Your divorce decree will in no way resolve you of responsibility for a jointly acquired mortgage loan.”
The unfortunate truth? When it comes to divorce and mortgage loans, you can take safeguards to protect your credit. But you can never guarantee that the mistakes of your former spouse won’t drag down your credit score, too.
The best options in your house mortgage
Andrew Vaughn, the owner of Chicago law firm NuVorce and a professor of advanced domestic relations law at Loyola University Chicago School of Law, said that the best solution for divorcing spouses is to either selling the home or refinance the mortgaged in the name of just one of the former spouses. That spouse would then be responsible for making the mortgage payments.
These solutions work best because the other spouse no longer has to fear missed payments or loan defaults that are the fault of their former partner. When divorcing couples sell the house, they use the proceeds of the sale to pay off their loan. When they refinance the loan to one spouse’s name, the spouse whose name is no longer on the loan will not see a credit drop even if the other spouse stops making payments.
Selling Your Home
If your lender doesn’t set you up with a title company, your next step is to hire an agent who will ensure that there are no issues with your property’s title. You’ll need to provide your title agent with your mortgage payoff amount and your account number. After you sign all of the documents you’re required to complete at the closing table, your title agent can send off your final mortgage payment and officially transfer the title to the buyer.
Once you sell your home and pay off your home loan, you’ll ideally have enough money left over to put into a savings account or use for other purposes.
We Buy Houses in Dayton Ohio
Bobs Crazy Property’s is one of Dayton’s premier real estate investing groups because we focus on doing things right. We specialize in distressed single-family houses (mortgage foreclosures, bank REO’s, sellers who need to sell fast). After we buy a house, the house is then remodeled and sold to a new homeowner to love and live in.
We will help you out to avoid your house from foreclosure. Fill out your information or contact us here www.bobbuyshousesdayton.com