Your Mortgage After Divorce: How to Keep or Requalify for Your Home

Divorce is emotional and complicated — and housing decisions are a huge part of the transition.

✅ Can you afford to keep the home?

To determine if you can afford to keep your home, evaluate your financial situation thoroughly. Lenders will assess your income, including salary and any additional earnings, alongside your existing debts like credit cards and loans. Your credit score will also be crucial, reflecting your creditworthiness.

Refinancing your mortgage might be a viable option to lower monthly payments by securing a better interest rate or extending the loan term. Compare different mortgage types, such as fixed-rate and adjustable-rate mortgages, to find the best fit for your needs.

Consider your long-term financial goals: Are you planning to stay in the area? Will keeping the home enhance your quality of life? These factors will help you decide if maintaining your home is a sustainable investment. A thorough analysis of your finances and strategic planning will guide your decision.

✅ Spousal Buyout Mortgage

Spousal buyout mortgages are specialized financial products that help during divorce proceedings, particularly in dividing shared assets like a family home. These mortgages allow individuals to borrow up to 95% of the home's current market value, enabling one partner to buy out the other's share and retain full ownership.

By using a spousal buyout mortgage, individuals can often avoid lengthy and costly legal battles. Traditional asset division methods may force the sale of the family home, disrupting lives and causing emotional and financial strain. In contrast, these mortgages provide a more streamlined and amicable resolution to property disputes.

These mortgage options offer flexibility, as lenders consider factors like income and credit history to create tailored solutions. This can lead to favorable terms, such as competitive interest rates and manageable repayment plans, easing the financial burden on the remaining homeowner.

Additionally, spousal buyout mortgages help maintain stability during a challenging time. Staying in the family home can provide emotional comfort and continuity, especially for children affected by the divorce. By securing funds through this mortgage, individuals can focus on rebuilding their lives with minimal disruption.

✅ Alternative lender solutions

If your credit or income isn’t strong (e.g. if you’ve been out of the workforce), alternative lenders can provide options, at least temporarily.

✅ Act early

The sooner you engage a broker, the more prepared you’ll be when the time comes to finalize property division.

💡 Tip: A broker can work alongside your lawyer to make sure you have realistic housing options as part of your divorce settlement.