Couples in Texas getting a divorce might want to ensure that they define the terms of their divorce settlements completely and clearly. In particular, the ownership of a couple’s home and the responsibility for making payments on underlying mortgage debt needs to be completely addressed.
In many cases, it is not enough for a divorce settlement to specify that one spouse will remain in the house and bear sole responsibility for the mortgage. The lender needs to not only be notified of the change, but often will require that a new mortgage be written solely in the name of the remaining spouse in order for the other spouse to be discharged from responsibility.
Divorce advisors offer some tips for divorcing couples when it comes to dividing up their real property. If both parties agree to sell the home, then the process is fairly simple. They sell it and split up the profits. However, if one party wants to keep the home, then they should try to refinance it in only the name of the spouse who wants to keep the home. If the home has equity, then it can be appraised and the spouse who wants to keep the home can pay an equalization payment to the other spouse. If neither party wants to remain in the house but market conditions preclude a sale, they could agree to rent out the house and split the rental payments on negotiated terms.
A person contemplating a divorce may wish to speak with an attorney who has experience in family law matters. The attorney may be able to negotiate and prepare agreements relating to marital property division.
Source: Reuters, “Splitsville? How to divide property in a divorce“, Geoff Williams, October 07, 2013