Home Loans and Support

How to Get Out of a Mortgage in a Divorce

Divorce sucks! I know because I went through one in 2002 and it was one of the most stressful times of my life. I lost my wife, home, money, kids and my family life in one fell swoop of the judges gavel.

I didn’t loose everything because I was a bad husband and father.  I got the short end of the stick because I didn’t use my head and acted on emotions, instead of intelligence.

Please don’t repeat my emotional and immature mistakes. Believe when I say this because I am still recovering from my mistakes 7 years later…..
There are not many options when it comes to deciding who gets what and how you can legally divide your property and debts. Making things even more difficult will be an uncooperative spouse. If that is the case, then good luck getting anything done or signed.

The best advice I can give you as be as nice as possible and bite your tongue when you feel compelled to argue. Each argument will take you one step further from solving your issues amicably and if you have children, DO IT gracefully for them

Getting out of the mortgage is an important step to take when you are going through a divorce. Many people keep the original mortgage and hope that one of them will continue paying but this is a risky situation.

 If your ex-spouse suddenly decides to stop making the mortgage payments (this happend to me), the lender will be coming after you and your credit score will suffer. With the original mortgage intact, you will also have difficulties in getting a new mortgage.

The easiest technique for getting out of the original mortgage is to sell the property. The money that can be obtained from the sale will be utilized to pay off the balance in the mortgage and you can divide whatever is remaining between the two of you. If the selling price fails to cover the mortgage balance then you and your ex-spouse would have to decide on how to pay for it.

What is important is that you both get out of the original mortgage and avoid the risk of hurting your credit score when one of you defaults on the payments. Of course, there might be pre-payment penalties so make sure to ask your lender about this.

Another way to get yourself out of a mortgage after a divorce is to let your ex-spouse refinance the home loan in his or her own name. Your ex-spouse buys out your equity share and you relinquish your share in the property. The problem is that this would require the approval of your lender and it would not also be possible if your ex-spouse is unable to qualify for the refinancing.

If your divorce has not yet been completed and your ex-spouse plans to continue living in the home, make sure to indicate in the divorce decree that he or she will be refinancing the property. You should also ask him or her to provide you with a Deed of Trust to Secure Assumption, which may enable you to foreclose and get back ownership for the property if he or she fails to make the payments or fails to refinance.

Another possibility is that your ex-spouse may assume the mortgage but this would be subject to the approval of the lender. Not all kinds of mortgage loans are assumable so make sure to consult your lender to determine if this is an option for you. If the lender permits one of you to assume the loan, you will have to apply for a release of liability and an assumption contract.

Your ex-spouse will have to submit the required documents to prove that he or she is capable of paying the mortgage by himself or herself. You may also be asked to provide the lender with a copy of the deed for quit claim and the divorce decree.

The lender may then provide you with a release of reliability if he approves the assumption of the loan by your ex-spouse. If the terms of your mortgage permit loan assumption, this may be a better option than refinancing the mortgage because assumption fees are less costly.

The other option you have is to just walk away and forget about your debts. Many people do this and concentrate on their kids and rebuilding their lives as opposed to hanging on to what is now worthless.

Trying to hang on or fight over worthless items or property is akin to being stuck in quick sand with a cement block tiedto your ankle!  You will go down with everything if you don’t untie that block and save yourself first!


About Moe Bedard

My name is Maurice Bedard, but most people call me Moe. I am the founder of America's #1 Mortgage Forum, LoanSafe.org, and also a website design firm called We Create Web Designs. My online work has been featured in the New York Times, LA Times, Fox Business, and many other media publications. I currently live in Carlsbad, California with my beautiful wife and children.

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