San Francisco Chronicle - (Sunday)
Breakup, separation and divorce during COVID19
Mortgage adviser: Brenda Wyatt, All California Mortgage. Loan amount: $628,000. Loan type: Conventional. Rate: 3.25%.
Property type: Singlefamily home in Oakland. Backstory: Unprecedented times call for unprecedented support. I’ve recently completed refinances for several clients who are going through a breakup, separation or divorce.
These lifealtering events are incredibly painful during normal circumstances — but even more agonizing during a pandemic.
Divorce is difficult enough as it is but deciding what to do with the house becomes a big issue.
As far as a lender is concerned if both parties are on the loan, they are jointly liable for the mortgage unless they sell the house or the property is refinanced with new terms and conditions.
The mortgage remains your responsibility — until you find a way to divorce it.
When two people purchase a home together and decide to separate, refinancing to “buyout” the other’s interest is an option.
With a cashout refinance, the departing partner receives cash for their interest in the property. The partner remaining on the mortgage needs to qualify for the new loan using only their income and assets. The process takes less than 30 days and requires an appraisal.
With a transfer of deed, both parties can go their separate ways. Divorce is complicated. Divorcing your mortgage shouldn’t be.