Why many divorced spouses continue to share a mortgage

On Behalf of | Jun 29, 2016 | Property Division |

Dividing a house during a divorce can be so complicated that some ex-spouses in Florida are actually choosing to keep living together. Although cohabitation after a divorce may sound impossible to some estranged couples, others find themselves in a situation where they are ‘house poor” and have no other option.

After the children, the marital home is probably the most contentious divorce issue. If two spouses took out a mortgage together, both of their names will remain on the mortgage unless one of them is able to get it refinanced. The problem is, qualifying for a new mortgage as a single person with one income can be much more difficult than qualifying as a married couple with two incomes. A divorced person who cannot pass the eligibility test by the lender won’t be able to get the ex-spouse’s name off the mortgage.

Whether the mortgage can be refinanced or not, divorcing spouses may agree to sign a quitclaim deed. A quitclaim deed is a transfer of ownership without any exchange of money. Although a divorcing spouse may agree to surrender property ownership rights in a quitclaim deed, the quitclaim deed will not automatically free the spouse from any financial responsibilities associated with the mortgage.

During property division negotiations, one spouse may agree to surrender rights to the marital home in exchange for a financial settlement. An attorney may be able to help a spouse to calculate the equity that is in the home and determine an appropriate buyout price. Hillsborough County property division attorneys may also be able to help a divorcing spouse refinance a mortgage.