When you and your spouse file for divorce, one of the most significant aspects of property division is deciding what to do with your home. If you already own the home outright, it is considered a marital asset. One of you may keep it — typically by trading other marital assets of similar value — or you may sell the house and divide the proceeds.
That said, many couples do not own their home outright. Instead, they have a mortgage and make monthly payments. Selling the house is still an option, as you and your ex would split the balance of your earnings after paying off the mortgage loan. But what happens if you want to keep the house and take over the mortgage payments?
Refinancing the mortgage
To keep the home, you generally need to apply for a new mortgage in your name. This is because both you and your spouse are likely listed on the original mortgage, meaning you are both responsible for future payments. The mortgage company does not consider marital status — as long as both names are on the loan, they can contact either party to collect missed payments.
In other words, even if your ex takes other marital assets and agrees that you will become the sole owner of the house, they would still be liable for future missed payments unless the mortgage is refinanced. Refinancing into your name removes their liability and ensures they are no longer tied to the property. This also makes it more likely that they will agree to this form of property division.
The financial side of this process can be complex. This is just one reason why it is important to explore all of your legal options while navigating a divorce.