What Happens to the Mortgage When You Get Divorced?

Few marriages begin with divorce in mind, but many end that way. And when they do end, one of the most challenging legal aspects – after working out child custody and support agreements – is often the division of marital property. Determining who gets what when it comes to physical property, savings and investments can be complicated. So can figuring out how to divide any marital debt. This is especially true when the debt in question is a mortgage.

Owning a home is a quintessential part of the American dream, but it is also often the largest debt many couples incur. Whether you and your spouse purchased a starter home or the home of your dreams, it is an asset that must be divided. Property division becomes more complicated when a home is not yet paid off and the mortgage must be addressed in a timely manner.

First things first: Is your home considered marital property?

In a Tennessee divorce, the primary question when determining responsibility for a mortgage (or any other debt) is whether or not the home in question is considered marital property. Under Tennessee law, property that was purchased by individuals before marriage is typically considered separate property, and is not subject to being divvied up by the court. However, there are exceptions. If, for instance, you purchased a home on your own before marriage, but then married your spouse and added his or her name to the home’s title, the home may be considered marital property in a divorce.

Similarly, if you purchased your home on your own prior to marriage but have used it as the family home for a significant period of time, or if your spouse has invested a substantial amount of money into home maintenance and improvements, the state may consider it marital property. If you are hoping to stay in the home after divorce, you may need to compensate your spouse for their share of the home’s equity. Or perhaps your spouse purchased the home before you were married and you do not want to, or are financially unable to, keep the home. If the home is now considered marital property, you may be on the hook for it financially along with your soon-to-be-former spouse.

It is important to note that Tennessee divides property equitably, which is not the same as equal. In other words, rather than simply splitting marital property 50/50, Tennessee courts seek to divide marital property fairly, which may be a 50/50 solution depending on the circumstances, but it may not.

Who pays the mortgage during the divorce process?

If there is still a mortgage on your home, then mortgage payments must continue to be made on time even if you and your spouse separate and divorce. While it may seem that the spouse who remains in the home is solely responsible for the mortgage, this is not always the case. The court may take many factors into account when determining which party in a divorce is ultimately responsible for the mortgage payment before a divorce is settled. However, a key piece of information to focus on is this: Whose name is on the mortgage?

If your name is on the mortgage, it is your responsibility

Even one late or missed mortgage payment can harm your credit, so ensuring that payment is made on time each month is critical – particularly if your name appears on the mortgage. This includes even if your spouse is typically the one responsible for making the payment. Consider this scenario: You and your spouse want to purchase a home. Your spouse has a higher income than you and will therefore pay all or a higher percentage of the mortgage each month, but you are in this together, so both your names are on the mortgage. This works fine until you and your spouse decide to separate and divorce. Whether your spouse remains in the home or you do is largely irrelevant during the divorce process if both your names are on the mortgage. A mortgage is a legally binding contract, and if your name is on that document, you are responsible for those payments. If a payment is late or skipped, your credit score could take a dive. Miss enough payments and the bank could foreclose on the property, leaving you without a place to live if you remained in the residence – and facing serious financial consequences regardless.

What should I do about my mortgage during a divorce?

If you and your spouse have made the difficult decision to divorce, it is critical that you understand your rights and responsibilities under the law. While the emotional aspects of a divorce often – and quite understandably – take precedence for you personally, the practical and legal aspects of divorce cannot be ignored. You should contact your mortgage lender as soon as possible, and make them aware of the situation. They will discuss your options with you. Ultimately, if your home is considered marital property, you have three options:

  • Refinance the mortgage
  • Sell the home
  • Buy your spouse out of the home

Like a mortgage, marriage is a legal contract. It ties both spouses together, for better or for worse, and the best way to mitigate any potential fallout is to speak with the experienced Franklin divorce lawyers at the Law Offices of Adrian H. Altshuler & Associates.

Our divorce attorneys are skilled in all aspects of family law, including divorce and the division of assets. We understand how deeply personal divorce is, and how difficult it can be to determine who gets what. That’s why we aggressively pursue the best settlement for our clients. From our offices in Franklin, Columbia, and Brentwood, we represent clients in divorce and family law matters throughout Middle Tennessee. Give us a call or complete our contact form to schedule a consultation.