Plan Ahead When Dividing the Marital Home

Deciding how to split the house can be the most difficult part of the divorce process for many estranged Texas couples. The home is often the most valuable asset a married couple owns, so its division drastically affects the split of the remaining marital assets.

Even if the couple can agree on an amicable split of their assets, they may encounter problems related to dividing the marital home. A situation often arises where one spouse gets to keep the home but both parties are still legally obligated on the mortgage. In most cases, the spouse who received the home would contact his or her bank and refinance without the ex-spouse on the new loan documents. However, this may not be possible if the new homeowner cannot qualify for a mortgage without the income of the ex-spouse.

One spouse may choose to buy the other out of his or her share of the home by giving up cash or other assets, and the cash for the buyout is often obtained by refinancing the home. If the couple cannot qualify for a refinance or the home is not worth enough to cover the spouse’s requested buyout, the couple can make up the difference with funds gifted from a friend or family member.

Consulting a family law attorney before separating can help divorcing couples understand their options and take the correct actions before it is too late to qualify for a loan. It may be best to apply for a new mortgage or refinance the marital home while both spouses are living in it and contributing their income to the loan payments. In other cases, the couple will be better served by waiting until the divorce decree is final and pursuing their own separate financing arrangements.

Source:, “How to Divide Your House in a Divorce“, Scott Sheldon, July 09, 2014

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