Sometimes it happens, no matter how hard we try or how little we want our marriage to end, but sometimes the route taken ends up in divorce. When it comes to real estate, there are many challenges that can result from a divorce. Especially when it comes to the disposition of the said real estate. During this hard time, here are a couple of pointers that I hope you will find helpful:
- If title passes to the vacating spouse by way of “Quit Claim Deed” or ‘ Grant Deen”, these deeds only affect the actual title to the property and it does not transfer the loan to the remaining spouse.
- If you change title by a “Quit Claim Deed” or “Grant Deed”, that both parties who originally signed the loan are still liable for the repayment of the loan. Those same people can be harmed by a future foreclosure, a non-payment of the mortgage, or even a late payment. Both of the original signers of the note are still wholly and separately responsible for the repayment of the existing mortgage, even though title has been passed by way of either the “Quit Claim Deed” or “Grant Deed”.
- If you refinance the property, the person who is leaving the property will be removed from the current mortgage obligation and can even be removed from title during the same transaction. Refinancing allows the party leaving to be completely freed, not only of the real estate, but also of the loan.