Undergoing a divorce is never an easy thing to experience. You’ll have a lot on your plate as you work to untangle your life from your spouse and move forward with your own life. Among the many challenges you’ll face, one of them is deciding how to handle your mortgage and your debts during your divorce. Here are some mistakes divorcing homeowners should avoid when making decisions about their mortgage:
5 Mistakes Made By Divorcing Homeowners in Florida
- Not Changing the Mortgage from Community Property to Separate Property. If you and your spouse are both on the mortgage, you might want to change it from community property to separate property. You must submit your request for a change of status to the company that holds your mortgage in writing. You must do this by the 45th day after the date of your judgment of dissolution or legal separation or the date of your court order or court-approved property settlement agreement. The company is required to comply with your request within 30 days of receiving your request.
- Not Segregating Your Debts. It’s easy to get caught up in your emotions and lose track of your finances when you’re going through a divorce. You might not be thinking clearly, or you might be angry at your spouse, and you may not be careful to keep track of what is community property and what is separate property. It’s important to make a list of your debts and to keep track of your payments. It’s a good idea to divide your debts into two categories:
Debts that are community property – the home you and your spouse jointly own.
Debts that are separate property – your spouse’s credit card debt
- Not Making Sure Your Loan Documents Are Correct. When you’ve just gone through a divorce, and you’ve got a lot going on, it can be easy to make a simple mistake that won’t become apparent until you start having problems with your loan. For example, if your marital status has changed and you’re no longer on the title, you may have problems paying or refinancing the loan in the future. You might have a hard time getting a replacement title with your new name on it. At the very least, you’ll have to go through the process of removing your spouse from the mortgage.
- Not Ensuring Your Spouse Doesn’t Default on Your Mortgage. It’s not just your responsibility to pay your mortgage; it’s your spouse’s responsibility too. While your divorce decree might say that your spouse will pay the mortgage during your divorce, you’ll want to make sure he or she doesn’t end up in default. A default could result in the house being foreclosed on, which would be devastating to both of you.
- Not Having Your Spouse Sign a Waiver. If your divorce decree says your spouse will be responsible for paying your mortgage, you will want to make sure that your spouse signs a waiver of liability. When a spouse is responsible for a mortgage, he or she is subject to liability, and a default on the mortgage could have serious financial consequences. A waiver of liability releases the mortgage company from any claims made against them by your spouse if your spouse fails to pay the mortgage.
Divorce is a time of big changes in your life, and you will have a lot on your plate as you adjust to your new life as a single person. It’s important to make sure your finances are in order before making any decisions about your mortgage. Avoiding these common mistakes is an important first step.
Contact American Mortgage Solutions To Get Started Today!
If you want to start over in a new city after going through a divorce, you’re going to need help from a mortgage broker.. That’s why American Mortgage Solutions is here to offer you a fast and straightforward way of finding you the right loan products no matter what your situation is. If you’re looking for a reputable mortgage broker in Louisville, KY or in Cape Coral, FL, contact American Mortgage Solutions to get started on finding the right loan for your needs. Get in touch with us today at (502) 327-9770 in Louisville or in Florida (239) 766-8344 and see how we can help you.