If you and your spouse are divorcing in Oklahoma and own a home, the question of what to do with the mortgage will be a major concern. Depending on your plans, you have options about what to do with the mortgage if you divorce.
Keeping the home and mortgage
One of the options available is to keep the home and continue paying off the mortgage jointly. However, there are very important things to consider in this scenario, including:
- If one person fails to pay their part of the mortgage, both credit histories will be affected.
- You will need to come to an agreement about how to cover the costs of maintaining the home.
- If you sell the home after the divorce, there will be different tax implications, which can result in much higher taxes.
Selling the home and splitting any proceeds
If you choose to sell the home before the divorce is final, you can pay off the mortgage and then split any additional monies left as part of your divorce settlement. Doing it before the divorce will also allow you to report the proceeds as a married couple, which might result in a lower tax burden.
One spouse keeps the home and takes over the mortgage
Another possibility is to have one spouse keep the home and take over the mortgage in exchange for other assets. While assuming the mortgage, or legally removing one spouse’s name from it, is no longer an option for most people, the person keeping the home will probably need to refinance the mortgage in their own name. This means they will need to meet all requirements and show that they can afford the mortgage.
Carefully consider what the best option might be for you. Your finances, your plans and your relationship with your ex-spouse will all play a role in the decision.
