Want to Keep Your Home After a Divorce? Here’s Why You Should Refinance
Divorces are complicated. There’s a lot that needs to be done, and that includes thinking about what to do with the marital home. Should you keep it or should you sell it?
This will depend on your preferences. Many people feel more secure in the family home. They have a lot of memories in it and want to keep it primarily to raise the kids in it. Others want a fresh start and this means getting a home of their own, without the bad memories of the marriage attached to it.
If one spouse wants to keep the house, then refinancing is a good idea. Refinancing your house offers several main benefits, such as those outlined below.
Remove Yourself or an Ex-Spouse From the Mortgage
Refinancing can help remove your name or your ex-spouse’s name from the home loan. If your current mortgage was taken out in both of your names, you both share an equal interest in the property. When you take out a new mortgage with a refinance, you can remove your ex-spouse from the loan and title. If your ex wants to keep the home, then your name will be removed in a refinance so you no longer have to be liable for payments.
You can also ask your lender for a release of liability, which removes your ex-spouse’s obligation to repay the loan. Removing one name from the mortgage can benefit the both of you. You are allowed to keep the home and your ex can purchase a new house after the divorce.
Change the Mortgage Terms
Refinancing after a divorce can help you get a mortgage with more favorable loan terms. You may be able to get a lower interest rate, which can help you pay off the mortgage sooner or lower your mortgage payments to make them more affordable. You can also refinance to change the type of mortgage you have. For example, you can change an adjustable-rate mortgage to a fixed-rate loan.
Access Equity
You can also refinance your home to get cash out. This is called accessing the equity in your home. Equity refers to the difference between your current mortgage balance and what your home is worth. Many people have equity in their homes. By refinancing your mortgage, you can convert some of your equity into cash. This can be used to pay off your ex’s share of the house. pay down debt, or fund a home improvement project.
Seek Legal Help
Dealing with a home after a divorce can be complicated. Should you keep it? If you do, what needs to be done to make the transition easier?
Fort Lauderdale divorce lawyer Edward J. Jennings, P.A. can help you deal with the various forms of asset division in a divorce, including selling or keeping a home. We’ll help you understand your options. Fill out the online form or call 954-764-4330 to schedule a consultation.
Source:
quickenloans.com/learn/refinancing-after-divorce
