Handling a Mortgage after a Separation or Divorce

Going through a separation or a divorce is very difficult, and there is a lot to consider, including the mortgage you once shared with your spouse. Deciding who gets the house and whether or not you should sell can be very challenging, and resolving this matter can take time.

It is important that you have a detailed understanding of your options so that you can make informed decisions and avoid mistakes that you will regret later on. If possible, start by talking to your ex-partner to see if you can agree on a desired outcome. Have an honest conversation with each other because this will give you an idea of where the two parties stand and whether one of you wants to keep the house more or if you’d like to keep it together as an investment.

Next, determine your home’s value because it is this value and the equity you have that will determine the options that are applicable to you. You should also consider bringing in legal help because a third-party moderator can help both parties come to a solution that is beneficial for everyone involved.

Mortgage After a Separation

Your Options for Handling a Mortgage After a Separation

Once you have this information, you can look into the different options that are available, and you can choose to:

Sell your home
Most couples are anxious to move out after a separation or divorce because they want to move on and start a new chapter. If this is how you feel, selling the home is the best option because this will provide you with capital so that you can live your own life. You would have to sell the house and pay off your mortgage and would be able to take the rest of the money for yourselves. If you don’t want to split the remaining money in half, it’s best to hire a divorce attorney right away, so make sure you take this step if you plan to fight for more than an even split.

If one party wants to keep the house, you can refinance it so that the home is only under that person’s name. Refinancing has additional costs associated with it, so you will have to consider legal, appraisal and banking fees. Refinancing is only an option if one party can afford the mortgage after a separation on their own, and this is rare because it’s hard for one person to handle the costs of a divorce and refinance fees and a mortgage.

Keep the house
You can rent it out and treat it as an investment property or you can choose to let one party live in the house. Both of these have downsides, including having to live in a home full of memories with your ex or having to see them on a regular basis to deal with tenants. Risks will be involved, and having this mortgage tied to your name can prevent you from being approved for other loans once you move on.


The truth is that these situations can be messy, so if you need to navigate handling a mortgage after a separation, Easy Approval can help!  We’ll be happy to talk through the options with you and help you find the right mortgage solution for your situation. If you’ve already navigated through dividing up your property and you’re ready to head into your next mortgage after a separation, we’re here to help you find the right lender for your needs.  Contact Peter today with any questions and if you’re ready, fill out our mortgage application online!