If you are like many people in Minnesota, your home is the single biggest asset you own. This makes the decision about what to do with your home during a divorce exceptionally important – and often quite difficult. The emotional ties a person can develop to a family home often lead at least one spouse to try and find a way to keep the home. If your spouse is requesting this, there are some things you need to know in order to protect your financial future.
As explained by The Mortgage Reports, you should only allow your spouse to keep your home if they are able to secure a new mortgage that is in their name only. The reason for this is simple: if your name remains on an active mortgage, the bank still considers you financially responsible for the debt. That means any missed payments, late payment or foreclosures can be reported on your credit report even if your former spouse was responsible for the payments per your divorce decree.
It can be difficult for some people to obtain a new mortgage in their name alone after a divorce as income drops and debt-to-income ratio increases. It is for this reason that many couples end up selling their homes when their marriages end.
If you would like to learn more about how to protect yourself financially when getting a divorce, please feel free to visit the homes, mortgages and property division page of our Minnesota family law and divorce website.