One of the many stressful challenges of getting a divorce is determining what will happen to the family home. Can you afford to shoulder the mortgage payments alone or buy a new house?
While life after divorce promises a fresh start in many ways, navigating an existing mortgage or securing a new one creates uncertainty. The good news is: there are answers.
Four things to know about divorce and mortgages
Maintaining a standard of living as a single person is a real and valid concern for anyone going through a divorce. However, there are four steps you can take to make it a reality, including:
- Equitably divide marital assets: It’s advisable to work with an experienced family law attorney who will aggressively fight for a fair outcome over property division as well as child and spousal support payments.
- Set a post-divorce budget: Your attorney and, in many cases, a financial advisor can help you determine what your budget will look like after the divorce is final. This enables you to see what you can afford and, ultimately, where you can live. Know your credit score and understand how to refinance a mortgage or apply for a new loan.
- Keep your divorce documents handy: When refinancing or trying to qualify for a new loan, have your divorce decree available to show loan officers. While you are now living on one income instead of two, it may be more important to prove you are no longer tied to an ex-spouse with financial problems.
- Examine your lifestyle: Coming to terms with your “new normal” could mean re-evaluating savings and spending habits, consolidating debt, finding a new or higher-paying job or down-sizing. Staying within your means and being honest with yourself is always the best approach.
Knowledge equals power
Moving, as well as moving on from divorce, isn’t easy. However, removing yourself from a problematic relationship and having your own space brings many rewards. Becoming educated and empowered is the best way to adapt to the many uncertainties created by divorce.