For many married couples in Hawaii, their primary family home is the single most valuable asset in their marital estate. The corresponding home loan associated with the property can, in turn, be the single largest financial liability that they share. When they make the hard decision to get a divorce, they must figure out what they will do with their house.
Many people sell their family homes in a divorce, but it is understandable that some spouses would prefer to keep their homes. This may be possible but, according to Mortgage Loan, the decision to hold onto a home after a divorce should only be made if certain criteria are met. For the spouse willing to leave the home and let their former partner keep the property, they should require that a new mortgage in the responsible party’s name only be obtained.
This is the only way that a person can know for sure that a bank lender will not pursue repayment for any missed or late payments from them, regardless of what is dictated by a divorce settlement.
Bankrate adds that spouses who want to keep their homes carefully evaluate their financial ability to do so. Post-divorce incomes are commonly lower than married, joint incomes and credit scores can drop during a divorce as well. These factors may make it harder to qualify for a new, solo loan, especially if there is little to no equity in the home. There may also be tax implications to consider, especially if spousal support is one of the components of a person’s income after a divorce.