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Divorce, mortgage and your financial future

It is not uncommon for people in New York to wish they could find a way to keep their homes when they get divorced. A home often has a lot of emotions and memories attached to it, making it difficult for people to view it as simply a piece of property. However, when getting divorced, it is important to assess a house financially.

If one spouse wants to keep the house, they should take care to make sure they can truly afford the house on their post-divorce income. The Mortgage Reports that the person who wants to keep the house should seek a new mortgage that is in their name only instead of keeping an existing joint mortgage. This is the only way that the other spouse can completely sever their financial ties to the home.

Some people believe that they can be protected by clearly outlining mortgage payment responsibility in a divorce decree. However, lenders focus on the home loan documentation first and foremost. Homes and mortgages are essentially two separate things. Missed or late payments by the person who was supposed to make them could show up on both spouse’s credit reports. The same is true of any foreclosure activity. This makes the need for a new mortgage a must.

If you would like to learn more about how to evaluate your options regarding your marital home when getting divorced, please feel free to visit the mortgages and property division page of our New York family law and divorce website.