Monmouth County Uncontested Divorce Lawyer for Mortgages
If you’re dealing with an uncontested divorce and want to learn about your options regarding the mortgage on your home, land, or other property, contact The Law Office of Andrew A. Bestafka, Esq. immediately. We can advise you of your rights and fight to protect your interests.
For many divorcing couples, one of the most important terms during negotiations is deciding how to divide the property. The marital home is often a significant asset. However, determining whether to sell and split the proceeds, continue to jointly own the residence, or allow one person to reside there is challenging.
The Monmouth County uncontested divorce lawyer of The Law Office of Andrew A. Bestafka, Esq. has represented clients in divorces since 2008. When a divorce is uncontested, you and your spouse might be able to agree on how to handle your marital home and the mortgage. We can assist you with the process and try to reach a favorable result. Fill out our contact form or call us at (732) 898-2378 for a confidential consultation to learn more.
Distinguishing Between Marital and Separate Property
You have marital and separate assets in a marriage. When you divorce, you and your spouse keep your separate property and split marital property.
Marital property is all assets acquired by either spouse while married. Separate property is property acquired before marriage or while married by a gift or inheritance.
If you and your spouse purchased your primary residence during the marriage, it is considered marital property and subject to division. Your home can be a marital asset even if it’s only in one of your names or one of you put up the money for the purchase.
If you or your spouse bought the home you live in before getting married or received it as an inheritance or gift from a third party, it is separate property. You don’t divide it during divorce proceedings.
However, for the home to remain separate property, the other spouse’s assets must not be commingled in the property. That means if you purchase a house before marriage, but your spouse pays the mortgage with their separate assets, it is marital property.
Dividing Marital Property in New Jersey
New Jersey is an equitable distribution state. That means the courts split property equitably. That doesn’t necessarily mean equally. If your home is marital property, the court can determine how to divide it fairly. The same rules apply when you share debt, such as a mortgage.
The judge can consider multiple factors to decide what to do with your residence and mortgage. Those factors could include:
- The standard of living established while married
- Duration of the marriage
- Contributions either spouse made to the other’s earning power or education
- Property or income either spouse brought to the marriage
- The time and expense a spouse needs to acquire the necessary training or education to achieve a standard of living compared to the marital standard
- Present value of all property
- Each spouse’s emotional health, age, and physical health
- Tax consequences of the distribution
- Each spouse’s overall economic circumstances
- Contributions either spouse made to preserve, waste, acquire, or improve the marital property, including homemaker contributions
- Each spouse’s liabilities and debts
- Legally enforceable prenuptial or post-nuptial agreements involving property and debt division
- Each spouse’s income and earning capacity
How to Divide a Marital Home in an Uncontested Divorce
Since the divorce is uncontested, determining a mutually beneficial solution to split your home shouldn’t be challenging. However, you can’t cut your house down the middle and walk with your half. Instead, you can choose one of these options:
- Sell the home – The simplest solution is to sell your residence and split the proceeds equally. You might decide an unequal distribution is best to compensate for one spouse giving up another asset or making significantly lower or higher income than the other.
- Buy out the equity – Another option is for one of you to buy out the other’s equity in the home. Typically, the person arranging a buyout will refinance the loan. The selling spouse can receive their agreed-upon share at closing, and the other will get a new mortgage loan only in their name.
- Co-own the house – You might decide it’s more beneficial to continue to own your residence after finalizing the divorce. Some couples choose this option because they have kids and don’t want to make drastic changes. You can revisit selling the home later and discuss what to do with the proceeds when the time comes.
What Happens with the Mortgage on a Marital Home?
The mortgage, marital debt, is treated similarly to marital property. The court will split your debt according to equitable distribution. When one spouse decides to keep the house, they assume responsibility for the mortgage.
A final divorce decree only impacts the divorced couple. It does not influence creditor behavior. A creditor can go after both parties despite the divorce decree requiring only one to make monthly payments. As far as the creditor is concerned, if both parties are listed on the mortgage, each person is equally liable. That means if your ex takes over the mortgage and falls behind on payments, it can affect your credit score, and the lender might take collection action against you.
If only one of you is responsible for the mortgage after divorce, the best option is to refinance, so the loan has the paying party’s name on it. Some lenders are willing to modify an existing loan to reflect the change in the divorce decree. However, most require a new loan.
Get Help Handling Your Uncontested Divorce
Although uncontested divorces are amicable, it doesn’t necessarily mean you and your spouse agree on every issue. When the topic of a marital home comes up, strong emotions can drive a person’s actions.
You should carefully consider which option suits your needs and interests. Selling might be a good idea to secure your financial future and set your kids up for college. You might suddenly want to keep your house because of all the pleasant memories you have with your family. However, that means you are likely also responsible for the mortgage.
At The Law Office of Andrew A. Bestafka, Esq., Andrew Bestafka approaches debt division on a case-by-case basis. One solution doesn’t work well for everyone. We will review your circumstances and advise you of a plan we believe will benefit you the most.
If you’re struggling to figure out how to handle the mortgage on your home during a divorce, call The Law Office of Andrew A. Bestafka, Esq. for a free consultation with an experienced uncontested Monmouth County divorce lawyer.