The process of separation and divorce can be a stressful time. People will be faced with working through a variety of changes and making important decisions that can impact the rest of their lives.

Working with a professional mortgage broker to determine the next steps with your property and your mortgage is an important step forward for your new life.

Mortgage Options for Divorcing or Separating Couples

Everyone’s separation and divorce is unique, but there are some mortgage options for this type of situation that are consistent and worth examining. Your best options include:

1. Renegotiate or Refinance Your Mortgage

If you had a joint mortgage and you want to transfer it into the name of just one person, then you will only be able to use that person’s income and credit rating to negotiate your new terms.

If you’ve decided to buy out your partner’s share of the home, you will need to account for those funds in your updated mortgage financing terms.

If you’ve decided to sell your home, then you will need to determine how your home is being sold, by whom, when, and how the proceeds will be split.

Sometimes, it may be wise to work with a lawyer to negotiate the terms of the agreement, but this isn’t always necessary. You should also consider whether selling your home will result in breaking your existing mortgage agreement and the incursion of penalties.

2. Sell Your Home

3. Buy A New Home

If you’ve decided to buy a new home, you will need to reapply for a mortgage as a single applicant. You will be required to reexamine your financial situation, your credit rating, your existing debt and equity, and your income.

If you plan to use the proceeds from the sale of your shared home towards the purchase of a new home, it’s best to have a professional mortgage broker arrange the paperwork for these transactions.

Buy Out Your Ex and Keep Your Home

One of the most commonly considered options is buying out your ex and keeping your home. There are many elements to examine when looking at this option.

Here are some key questions to ask yourself:

  • Will you have enough income to cover the buyout and the remaining mortgage payments?
  • Is it better for you to buy out your ex, or for your ex to buy you out?
  • Will you have less than 20% equity in your home after the buyout?
  • How will changing your ownership impact your insurance?
  • Do you plan to have your property appraised for an up-to-date valuation?
  • Have you examined a variety of refinancing options?

How Fran Can Help

“I know firsthand what is involved with all the intricacies of refinancing and selling your home after a divorce. I also know how great it feels to move forward with a new, feasible plan and an exciting future.”

You have enough to concern yourself with during a separation or divorce. When it comes to your mortgage and your home, it is essential to work with someone who will help you understand your best options, so you can make the right choices. Fran will help you determine the best options for your future.