If you own a home, there is a very good chance that it is your most important financial asset. If you and your spouse are separating, it’s important you seek advice from a mortgage professional early on. One of the goals of the divorce process is making sure both parties can start on a new path successfully, and deciding what happens to your home is an important decision in that process. If you have a final separation agreement, a mortgage advisor can help show you the power of your mortgage and the value in your home in order to help you both move forward in prosperity.
Does one spouse want to stay in the joint home?
Many separating couples assume that they have to sell the house, but it isn’t true if the two can come to an agreement. The home can be refinanced and this equity can be used to pay off joint debt and even be used as part of a negotiated payout to one spouse. One spouse could even purchase the home outright, taking the other spouse off the title completely.
Spousal Separation Mortgages
A Spousal Separation Mortgage is a 95% Loan to Value that can be purchased during a separation as long as a few guidelines are met. The two separating parties must be on the title of the property, and one of those two spouses must be keeping the property. A finalized separation agreement must be in writing and signed. An offer to purchase agreement from spouse to the other must also be signed. The 5% down payment required for this mortgage will be taken from the existing equity on the property. A mortgage professional can help you through this complicated process.
Does one spouse want to buy a new home?
Separation and divorce don’t put an end to your financial hopes and dreams. A mortgage professional can help you look at your options and evaluate your current financial situation to see if purchasing a new home is a possibility. If your spouse is keeping the joint home, you may have a nice sum of money to work with because of the payout, which can be used as a nice down payment on a new home.
For help navigating through what your separation means for your current and future home and mortgage, contact a mortgage professional at The Mortgage Advisors today!