We have previously discussed some of the reasons why people decide to keep the house in a divorce. It has been noted that paying the mortgage can sometimes be a strain since your financial circumstances are likely to change following the divorce.
But one important thing to keep in mind is that keeping the home likely means refinancing your mortgage. This can be problematic for some people, who may be worried that they won’t even qualify for the same mortgage on a single income.
Defining responsibility
The reason why a mortgage needs to be refinanced is because the person on the mortgage is responsible for those payments. If you and your spouse are listed, even if you got divorced, the lender is still going to hold both of you responsible.
For example, say that your ex wants to keep the house and so you agree to let them have it without refinancing the mortgage. They assure you that they will make the payments. They do for the first few years, but then they start missing payments.
The two of you haven’t even been together for years, and you may have largely moved on with your life. You have your own home, your own family and your own expenses. But that previous lender may start calling you and demanding payment, and they would be right that you are responsible for those missed payments since you’re still on the mortgage.
But if your ex refinanced and got their own mortgage, then only they would have to make those payments. You would have a clean break from a financial perspective.
As you can see, dividing assets can sometimes be a bit more complicated than people realize. If you’re in this position, take the time to carefully consider your legal options.