What’s The Right Answer?
In a divorce, it is very common for the parties to own a home. A common question we get is, should I:
- and/or give my ex the home?
The answer is always…It depends. In most cases, the best option is to give the marital home to your ex and have them pay you out half of the equity. This way you actually have the actual value/equity and do not have to pay closing costs/renovations etc. if you sell.
In some instances, though, one spouse wants to keep the house and the other doesn’t, or maybe there are kids involved and the custodial parent is hoping to stay in the home for the semblance of normalcy for the children’s sake. In those situations, some opt to refinance the house in order to stay in it, so they buy their ex-spouse out of the house. Here are 6 considerations for refinancing a house during divorce.
Home Refinance Considerations During Divorce:
- Once you do refinance the home, your monthly mortgage payment may be less than it was before. But plan on paying “closing costs” (which can be several thousand dollars) in the refinancing process. However, if you keep the home and have to pull money out of the home to pay off your ex then you can expect your mortgage payment to go up.
- Make sure you will actually be able to pay the new monthly mortgage of the house on your own (though you can factor in any alimony or child support you expect to receive). You’ll also need to (individually) have a good enough credit score.
- In the refinancing process, you’ll need to have a new home appraisal done. This is good because it will let you know how much money you’ll need to plan on paying your ex-spouse to buy them out through a “cash-out refinance” (so you’ll pay them half the appraised value by using your share of the home’s equity).
- You’ll need to have a relatively decent relationship and line of communication with your ex-spouse to be able to get all the home division issues settled. If you’re in a highly combative place with your ex, your attorney and/or mortgage broker becomes extra important to help you work out the details with your ex.
- You’ll need to have your ex sign a “quitclaim” deed, which changes the name of the home from joint ownership to be solely in your name.
- You most likely will have to refinance the home out of your ex’ name sooner than later. The courts are moving away from allowing you to hold off a refinance for several months and/or years. Therefore, if you want to keep the home you need to start working on a plan now to be able to accomplish it.
Getting Help with Your Utah Divorce Case
If you are looking into a divorce and need legal help, we’re here for you. CoilLaw advocates for its clients with the diligence and strength each needs individually. CoilLaw works hard to protect what is so precious to their client and to ensure that each person feels heard, validated, and valued!
CoilLaw works as a team so that you never feel alone, and you get a team of experts that are working hard for you and your case. CoilLaw is dedicated to helping you feel that you’re not just hiring a lawyer but a trusted friend. If you need legal advice concerning a Provo divorce and family law issue, call Jill Coil at CoilLaw LLC in Utah at (801) 939-6027 or 801-980-2627 today.