Addressing Mortgage Concerns During a Texas Divorce

No matter the length of the relationship, couples in Texas and elsewhere will typically make investments together. While this could mean buying stocks and bonds, it generally means purchasing property jointly. For most married couples, buying a home is not only a goal, but is a purchase that solidifies the couple as a family. And while owning a family home is very symbolic of a happy family, this does not always mean spouses will remain together. When marital problems occur, this means taking the time to consider what is best for everyone. And, if divorce is the best option, the divorcing couple will need to address property division concerns.

Because Texas is a community property state, and the family home is categorized as marital property, both spouses own the home. When the couple divorces, they will need to determine who will keep the home, what is owed to the other spouse if one keeps the home or whether the house will be sold and the proceeds split.

If a family home is owned jointly, and a mortgage loan was taken out initially, the payment on the loan should also be addressed as well. While the loan was entered into without divorce in mind, it is important to consider the what-ifs, just in case a couple does not remain together. Having a default on a loan, especially if it is in both names, could be damaging for spouses trying to make a fresh start in their post-divorce life. Thus, taking the time to address any concerns regarding a mortgage is imperative.

Dealing with a mortgage during dissolution means amicably sorting out this financial situation. While there are several ways to sort out this matter, there are three common ways to do it. First, the property could be sold, clearing the loan. Any proceeds from the sale would be divided equally. Next, one spouse could take over the ownership of the property and settle any contributions of the other spouse. The property could then be refinanced based on the borrowing capabilities of that spouse. Finally, one spouse could be cleared from the mortgage and the financial institution could assess the spouse’s repayment capacity by looking at the outstanding loan amount.

Divorce can bring with it various contentious issues; however, dividing major pieces of marital property, such as a home, tend to top the list. If you are dealing with property division issues during dissolution, it is important to understand your matter and how best you can navigate it towards a resolution.

Source:, “Impact of divorce on a property under joint ownership,” Amit Sethi, July 17, 2017

Related Posts
  • What Items Does Texas Law Exclude from Community Property? Read More
  • How Is Community Property Divided in Texas? Read More
  • Should Your Airline Miles Be Part of Your Divorce Settlement? Read More