Divorce rates are increasing around the world, and relationship experts warn the pandemic-induced break-up curve may not have peaked yet. BBC
— Garrick Werdmuller, President/CEO Fresh Home Loan
ALAMEDA, CA, UNITED STATES, November 7, 2022 /EINPresswire.com/ — Unfortunately, divorce is a common reality in America, and one of the hardest decisions to make is “What are we doing with the house?”. The short answer is sell or refinance. If one is planning on selling, this information may not be for you. If you are keeping the home, chances are you will need to refinance for a variety for reasons.
Reason #1: Debt Liability
Your divorce decree doesn’t affect your liability for debt, nor does it excuse it. Divorce decrees are issued by the courts at the end of divorce proceedings and state the division of community property. However, your mortgage lender is not legally required to take any action as a result of a divorce agreement. This means they can still hold the two ex-spouses liable for the debt. If one person stops paying, it will affect both persons credit profiles.
For this reason, it is essential to refinance the house, whether you are the departing party or the one staying on the home. You do not want that liability on your credit profile as you move on with your life.
Reason #2: Purchase A New Home
As mentioned above, a refinance is one way to remove someone’s name from the mortgage. This protects the spouse who no longer has ownership interest in the home. It also relieves them of the debt which can be crucial when looking to buy the next home. If one has the ex spouse’s mortgage on their credit profile, and there should be negative activity for any reason, it will lower the credit score and could affect the debt to income ratio, making it harder to qualify.
Reason #3 Cash Out
Property values have climbed over the past several years, which means there is an equity share of the house and the departing spouse will most likely want their legal portion of the equity. The best way to do this is a cash out first mortgage which can remove the departing spouse from title as well. An Appraisal will give the value of the home which can then determine how to split the equity of the home. Once this is determined loan docs are drawn removing the departing spouse from title and sending him or her the cash proceeds of the refinance upon closing.
For more information or to get a rate quote please visit: https://freshhomeloan.com/todays-rate-checker/
Or contact me at:
Garrick Werdmuller
President CEO
Fresh Home Loan Inc
510.225.6407 call/text
garrick@freshhomeloan.com
www.FreshHomeLoan.com
NMLS 242952
All loan approvals are conditional and not guaranteed and subject to lender review of all information. Loan is conditionally approved when lender has issued approval in writing, but until all conditions are met, loan cannot be funded. Specified rates and [products may not be available to all borrowers. Rates subject to change according to market conditions and agreed upon lock times set by borrower. Fresh Home Loan Inc. is an Equal Opportunity Mortgage Broker in California. This licensee is performing acts for which a real estate license is required. Fresh Home Loan, Inc. is licensed by the California Department of Real Estate #02137513 NMLS # 2124104
Garrick Werdmuller
Fresh Home Loan Inc
+1 510-225-6407
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Your Divorce and Your Mortgage: 3 Reasons to Refinance when Getting a Divorce.
