Divorcing residents in Texas who own a home together with their spouse may want to try and keep their house after their divorce, but this decision should be carefully reviewed to protect both parties’ financial futures.
It is not uncommon for a house to be a married couple’s most significant asset. It is also an asset to which a great amount of emotion can be attached, especially if a couple has raised its children in the home. Therefore, it is only natural that a person in Texas might want to try and keep their house if they get divorced. This may well be possible but is not a decision that should be taken lightly, especially by the person who will leave the house.
Homes are only one part of the marital estate
One thing that is important for both spouses to keep in mind when discussing how to address their home in a divorce is that the home is just one piece of their overall estate. According to U.S. News and World Report, all assets and debts should be evaluated together before decisions are made about any of them.
It may end up that a spouse who wants to keep a house learns that they will have to cede other assets in exchange, and that reality may not be something they wish to do. Retirement accounts, vehicles, timeshares and more should all be part of this review.
If a couple considers selling their home, they should also be prepared to factor in the costs associated with that decision. These may include capital gains tax, closing costs, realtor commissions and more.
Mortgages are separate from homes
Keeping a home after a divorce is not necessarily as easy as including a provision in a divorce decree or even signing a quit claim deed. Instead, the person keeping the house should seek a new or refinanced mortgage as well. As explained by The Mortgage Reports, this is the only foolproof way of eliminating financial responsibility for the other party.
A bank considers the parties on the loan to be responsible for that mortgage, even if they no longer have legal ownership in the property. This means the person who leaves the home and may even have signed away their rights via a quit claim deed could find their credit report damaged when a late or missed payment is reported on it.
Proper counsel is imperative
Making the right decisions when negotiating a property division settlement can be difficult and require a close eye on not just the immediate facts but the future as well. For this reason, Texas residents are encouraged to seek experienced legal counsel when getting divorced.
