If you are planning to keep your family home after the divorce, your spouse's name has to be removed from the mortgage. By taking this action, you can ensure that your spouse is no longer financially responsible for the home and that you do not have to share any profit you make if you sell the home in the future. Here is what you need to do to take sole possession of the home.
Negotiate With Your Spouse
Unless your spouse is willing to walk away from the home without receiving any sort of compensation, you have to negotiate a buyout of his or her part of the home. To do this, you need to have your home appraised so that you can determine its value. Once you know the value, you can offer to buy your spouse's share of the home.
How much you pay your spouse for his or her share depends on several factors. For instance, you can ask your spouse to split the value of the home 50-50, but deduct from the amount you owe him or her several expenses. You could request that expenses for repairs and fees associated with finding a new loan to pay for the home is taken out of his or her share. Your attorney can help you identify any deductions that need to be considered and help you negotiate a fair buyout amount.
Obtain a New Loan
To remove your spouse from the mortgage you currently share, you will have to obtain a new loan to refinance your mortgage. Of course, the new loan will be solely in your name. Removing your spouse is important. If you do not and you fall behind in payments, the mortgage lender can go after your spouse for the payments even though both of you agreed that you would be responsible for the home.
In order to obtain a new loan, you will have to go through the loan process again. This includes showing you are financially able to pay for the new mortgage. If you are unable to get approved for the loan, talk to your attorney about other options you could possibly have, such as getting a cosigner.
File a Quitclaim Deed
The final step is to file a quitclaim deed. The document basically states that your spouse is giving up any claim to the property. No matter what happens in the future, your spouse cannot make any claims against the property.
You and your spouse have other options for handling the division of the home. Your attorneys can help you decide which would be best for your financial situation.
To learn more, contact a family law office like The Law Offices of John G. McGill, Jr.