For many couples, a home represents the greatest asset they have, and they do not want to share that asset with their spouse if the marriage comes to an end. In New Jersey, divorcing couples with a mortgage have three options.
Couples may sell the home
If neither of you wants to remain in the home following your divorce, your easiest option may to sell the home. Things to keep in mind while selling your home:
- This option may be the simplest way to clear your credit to buy a new home.
- You may lengthen the divorce proceedings if the housing market is unfavorable.
- Spouses who have emotional attachments to the home may fight this option and prolong the divorce.
You may buy out your spouse’s share of the home
You also have the option to buy out your spouse’s share in the mortgage. Typically, this option requires you to refinance the property. During the refinancing procedure, your spouse would also remove their name from the mortgage.
Cooperating spouses do not have to sell or refinance the home
In some cases, spouses may not want to sell the home and cannot afford to refinance the home. If you are on good terms with your spouse, you may be able to work out an agreement that allows one spouse to move out of the home while the other remains in the home for a specific number of years. This arrangement is common for couples who have children and do not want to uproot them.
State law wants both spouses to benefit equally
When tackling mortgage concerns during a divorce , keep in mind that state law requires marital assets to be divided among you and your spouse equitably. This includes any decisions that are made concerning your property.