Divorce is a process that affects more than just the two parties involved. Aside from any potential children, family, friends and acquaintances that may be caught up in the mix, there are also major financial decisions that can come into play.
Having joint ownership on a home makes this notion doubly true. Between the stacks of paperwork and the emotional labors that come with divorce, it can be difficult to focus on the matter at hand: determining how to make the most amicable and financially responsible decisions regarding the property.
Below are four essential tasks to consider that will help make the process as painless as possible:
KEEP MAKING HOUSE PAYMENTS.
More often than not, people involved in a divorce take it upon themselves to stop paying the mortgage all together. This can cause a bank to foreclose on a property, which would then have a catastrophic effect on credit ratings. Bad credit can haunt you for years to come. One day you will be ready to move on, and you’ll definitely want to put your best foot forward, especially financially.
DON'T QUIT CLAIM THE TITLE TO YOUR EX.
A very common strategy during a divorce is for one spouse or the other to relinquish ownership of the property. In this scenario, the spouse left holding the shorter straw may “quit claims” out of the title, but their name still remains on the mortgage. This means that the spouse that was supposedly “out” is still financially responsible for the monthly payments.
So, imagine still being stuck with a portion of the financial burden with none of the benefits of owning property. This is clearly not an ideal situation for anyone.
DECIDE IF YOU CAN STILL AFFORD YOUR HOME.
When experiencing a divorce, as mentioned earlier, a great deal of financial changes can be felt by both parties. This is most noticeable if the relationship relied on one income or if the only way the home was affordable was by way of a two-income situation.
Taking a step back and reassessing whether or not a home is still affordable after divorce, albeit difficult at times, will help maintain financial security well after the final divorce papers are signed.
DECIDE IF YOU SHOULD STILL AFFORD YOUR HOME.
There are several things to consider when it comes to whether a home should still be afforded. Primarily, the well-being of any children should be a priority. Striking a balance between security and financial stability will ensure a better outcome for children involved.
Confirming the value of one’s home is also very important in the decision-making process. Moreover, depending on financial stability and overall needs, selling or refinancing are very strong options when handling the fate of the home.
Keep in mind, though, if a house is underwater: bad credit, missing documents or late mortgage payments, refinancing the home may not be an option.
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