A divorce is often emotional, but in addition to managing your emotions, you must figure out how to disentangle your life from that of your ex-spouse. An important part of this involves dividing up your assets and debts. For many former couples, figuring out what to do with the mortgage is an important step in the process.
The options you have as far as your mortgage vary based on how much you still owe, how much your home is worth and whether either of you wants to keep it, among other considerations.
If one of you wants the home
If one of you wants to stay in the home and the other does not, the party who wants to live there moving forward should refinance the mortgage to exclude the former spouse. This requires the party who does want to stay there to qualify for a new loan on his or her own.
If neither of you wants the home
If neither of you has a desire to remain in your once-shared home after your divorce, or if the party wanting to stay is unable to qualify alone, you may decide to sell the home. As long as you are not upside-down on your mortgage, this should enable you to pay off any remaining mortgage debt and then split and pocket any profits.
If both of you want to keep the home and you both qualify for a new loan on your own, you may have to explore alternative solutions. Think twice before fighting over the home just because you want to “win.” In some cases, selling it may benefit you financially and emotionally in the long run.