What You Need to Know About Refinancing Before or After a Divorce
Do you want to remain in your marital home after your divorce? Refinancing may be your best option. Continue reading to learn more about refinancing after divorce.
Divorce and Mortgages: Why Do I Need to Refinance During or After a Divorce?
One of the biggest challenges a couple will face during the divorce process is what to do with the marital home once the divorce is finalized. Because your divorce does not dissolve your mortgage, you will still both be financially responsible for the property until it is sold or you pay off the mortgage. If you or your spouse wishes to remain in the home, refinancing is often the best way to remove one party from the loan.
Fortunately, this process is straightforward, similar to any other refinancing situation. At The Simpson Team in San Diego, CA, we can walk you through the entire process. Continue reading to learn more, or contact us today for a free consultation.
Deed vs. Mortgage
Your mortgage is a financial agreement between you and your lending institution, binding until the loan is repaid, regardless of your marital status. Your home’s deed shows the legal ownership of your home. You will also need to remove your partner from the deed, or they could be entitled to a profit if you later decide to sell.
What Happens If I Can’t Refinance After Divorce?
If you and your ex-spouse purchased the home together and had a higher combined income, you may not qualify for the remaining balance. In that case, you may be able to request a loan assumption from the lender. This would allow you to assume the loan and remove your partner. However, many lenders can be reluctant to offer a loan assumption, leaving refinancing as your better option.
How Long Do I Have to Refinance After a Divorce?
The terms of your divorce will determine how long you have to refinance your home if you are the one remaining in the house. If you do not qualify for financing on your own, you may be able to wait until you do. However, your ex-spouse may not want to be financially responsible for the home longer than they have to be.
How The Simpson Team Can Help
Refinancing after divorce is always challenging, but we are here to help. At The Simpson Team, we specialize in helping our clients find creative lending solutions to all life’s biggest challenges. With 30 years of experience and thousands of clients served, we’ll do everything we can to help you find a loan that fits your budget while getting you the best rate possible.
How Much Does Refinancing After Divorce Cost?
If you decide to refinance your home, you will need to pay closing costs on your loan. However, you may be able to lower your monthly payments if you already have equity in your loan. You may also qualify for a lower interest rate depending on the terms of your new loan.
Apply for Mortgage Refinancing Today
If you are considering refinancing after a divorce, you need the right team to guide you through the process. Contact The Simpson Team today at (619) 685-9692 to find out how we can help.