Get closure on your foreclosure after divorce
Foreclosure and divorce
Call it what you will – a monkey on your back, dark clouds above, or a giant pain in the ass – regardless of their nickname, foreclosure woes will continue to nag at you until you decide enough is enough. Unlike an ex, foreclosures don’t always haunt you long after they’re gone – in fact, if done correctly, you can get a new home that will make you forget all about what’s his/her face place.
All jokes aside, one of the main reasons behind foreclosure is divorce. If you’re sitting there thinking “I’m not here because of divorce”, consider yourself lucky (keep reading though, what you’re experiencing is more of a metaphorical break-up). If divorce is something final, consider foreclosure that last loose end you need to tie.
Divorce circumstances are aplenty – he cheated, she’s a bad mother, he’s always working, she’s always out with friends, he doesn’t care about me, she loves someone else – the common thread is the debt that needs to be settled so you two can go your separate ways (very, very separate ways). It’s a break up with each other, and as such, a break up with the home you once shared. Whether you like it or not, you must work together (one last time) so that you can both move on peacefully.
Step 1: Who legally owns the home?
First things first: you must figure out who holds the mortgage debt. In most cases, married couples take out a mortgage, obtain the loan, and take title to the property together. (NOTE: the same principle applies to friends, family, or any other mutual arrangement where 2 or more parties decide to share a home). Occasionally, only one spouse shoulders the mortgage and signs the promissory note (a signed document containing a written promise to pay a stated sum to a person/bank). Before you begin, it is important that you determine who holds the cards.
Step 2: Who wants the home after divorce?
There may be an instance where one of you wants to keep the home. Don’t fret – this arrangement is achievable through proper planning. To make it work, the spouse that wants to stay must either (A) assume the loan or (B) refinance the loan under their name. That way, the spouse that wants out can clear their name while the other takes ownership of the mortgage.
Things start to get interesting when no one wants the home. While this scenario does offer the most options, it’s also where couples, friends, and families start to default on their mortgages. When everyone wants out, mortgage payments tend to be the first thing neglected. As we all know, with missed mortgage payments come foreclosure warnings.
Step 3: Review your options
So what are your options? Many call this the make or break point. Basically, after a divorce, there is a period of time where the parties involved can work together or neglect their payments and enter foreclosure. If you and your spouse haven’t defaulted yet, here’s what you can do:
- Rent out the property and apply the rental income to your mortgage payments
- Do a short sale with the bank (sell your home for less than you owe)
- Sell your house quickly for a cash offer to pay off the debt
While cash offers sometimes have a negative connotation, companies like Globalized Homes are well-known for their empathy and comprehensive approach. First, they run through every possible scenario to keep you out of foreclosure. Only when there are no alternatives do they come up with cash offers that are fair to all parties involved and keep the stain of foreclosure off your records.
Whatever circumstances brought you to foreclosure, know that there are still honest people out there who prioritize getting you back on track. Don’t let another minute go by without securing your future. After all, peace of mind isn’t a dream – with the right cash offer from the right person, you can finally reward yourself with a clean slate, money in the bank, and limitless opportunities to do things the way you always wanted.