How to deal with a house in a divorce

Pierre Domercq Divorce

California residents who are going through a divorce may wonder how it may impact their mortgage or who gets to keep the marital home. While it may be comforting to remain in the home because it is familiar, it may not be the best financial decision. In some cases, it may be best to sell it and split the proceeds. It may also be possible for a spouse to buy out the other spouse’s interest in the property.
If a divorcing couple chooses to sell their home, they may not necessarily split proceeds from the sale 50/50, even though California is a community property state. Instead, it may be split based on terms of the divorce settlement that the couple has been able to negotiate. Those who plan on buying out their spouse may need to consider whether refinancing the current loan is a possibility.
This is because the original mortgage approval may have been based on a couple’s combined income. When applying to refinance, a lender may only consider a single income, which may or may not be enough to qualify for a new loan. It is important to note that each person on the mortgage is responsible for future payments until or unless the loan is refinanced into one person’s name.
The property division process is often one of the most contentious issues in a divorce. Therefore, it may be worthwhile to talk to an attorney. Legal counsel may be able to get an individual as large a share of marital property as allowed by law.